Berkshire Hathaway, led by Chairman Warren Buffett, reduced its stock investment proportion in the third quarter of this year and invested the funds in short-term government bonds.
On the 14th (local time), Bloomberg News reported, citing a regulatory filing, that Berkshire Hathaway sold approximately $7 billion (about 9 trillion KRW) worth of stocks and purchased only $1.7 billion (about 2 trillion KRW) worth, thereby reducing its stock holdings in the third quarter.
During this period, Berkshire Hathaway liquidated or reduced its stakes in automaker General Motors (GM), gaming company Activision Blizzard, Hewlett-Packard (HP), Johnson & Johnson, and others. The GM holdings were completely sold off over the first and second quarters.
Berkshire Hathaway also reduced its stake in Activision Blizzard, which was under antitrust investigations by major competition authorities in the US and Europe during Microsoft's (MS) acquisition process. The stock sales occurred before the completion of the Activision Blizzard and MS merger in October.
The Wall Street Journal (WSJ) analyzed that Berkshire Hathaway's current stock holdings are concentrated in five companies: Apple, Chevron, Bank of America, American Express, and Coca-Cola.
Throughout this year, Berkshire Hathaway has been a net seller of stocks worth $23.6 billion (as of the end of September), investing most of these funds in short-term government bonds.
Earlier this year, Buffett attracted attention by selling shares of Taiwan's TSMC, the world's number one foundry (semiconductor contract manufacturing) company. Having first invested in TSMC in the third quarter of last year, he sold 80-90% of his total holdings in less than three months. This unusual short-term investment move by Buffett, who has emphasized long-term investment principles, was interpreted by the market as a concern over the semiconductor industry's downturn or as a precaution against rising Taiwan-related risks.
The US stock market, which had rallied mainly in technology stocks earlier this year, has recently shown a sluggish trend as investors' risk aversion increased due to the sharp rise in US Treasury yields in the third quarter. During this period, the large-cap focused S&P 500 index fell by 3.6%.
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