Warren Buffet’s Berkshire Hathaway Sells Over $10 Billion in Bank of America Stock

Warren Buffett’s Berkshire Hathaway has made headlines by offloading over $10 billion worth of Bank of America (BAC) stock since mid-July.

This series of sales has brought the investment firm’s stake in BAC below 10%. The recent selling spree included a 16th round where nearly $370 million in shares were sold, which has raised questions about the reasoning behind this significant divestment.

Analysts speculate that the move may be linked to profit-taking, especially given that BAC’s stock has increased by 75% since last October. However, some believe that the decision could also be influenced by taxation logistics.

Investors who hold a 10% stake in a company must report trades to the U.S. Securities and Exchange Commission (SEC) within two days, rather than on a quarterly basis, which could explain Berkshire’s strategy to drop below this threshold.

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Interestingly, Berkshire briefly fell below the 10% stake in early September but repurchased $3.5 billion worth of BAC stock in Q3, pushing their holdings back up momentarily.

Since the start of this selling trend in July, BAC shares have declined by over 4%, prompting speculation about whether Buffett might be considering a complete exit from the position. This situation mirrors past moves by Buffett, who has similarly liquidated holdings in other banks, including JPMorgan and Wells Fargo.

Kostadin Dimitrov