Warren Buffett Sells The S&P500: Understanding the Move and What Comes Next
And What I'm Personally Doing
To Smart Investors,
First, some history of Berkshire Hathaway:
Feb 14, 2024: Q4 2023 13F filing shows net stock sales (~$0.5B), with a move to T-bills.
May 4, 2024: Q1 earnings & Annual Meeting reveal a major Apple stake cut and cash rising to ~$189B.
July 30, 2024: SEC filings disclose significant Bank of America stock sales.
Aug 3, 2024: Q2 results report cash surging to ~$277B, with aggressive T‑bill purchases.
Nov 2, 2024: Q3 results confirm further equity sell-offs; cash climbs to ~$325B.
Nov 14, 2024: The 13F filings confirm $133B in net equity sales, solidifying the shift toward T‑bills.
On March 21, 2025, financial markets reacted sharply to reports confirming that Warren Buffett’s Berkshire Hathaway fully exited its holdings in the Vanguard S&P 500 ETF (VOO). Berkshire sold approximately 43,000 shares worth roughly $22.7 million.
Although relatively small compared to Berkshire's massive portfolio, the symbolic impact of this decision, given Buffett’s legendary investment status, has sparked significant concern and widespread attention.
However, it’s essential to recognize this wasn't an impulsive or sudden decision.
The actual sale occurred in the fourth quarter of 2024, with the information becoming public only recently through standard SEC disclosures.
While this delay is standard practice, Buffett’s reputation amplifies the significance of this disclosure, profoundly influencing Investor sentiment.
Looking for something that is possibly a guardrail against recession?
Why Did Buffett Sell? Understanding the Strategy
Buffett’s decision aligns with his historically cautious stance toward elevated market valuations rather than signaling a pessimistic outlook for the broader U.S. economy.
Rather than predicting an imminent market downturn, this strategic move underscores Buffett’s well-known investment philosophy: prioritizing safety, liquidity, and readiness during periods of uncertainty.
According to SEC filings, the proceeds from the sale of VOO shares were primarily directed into short-term U.S. Treasury bills, specifically those maturing within three to six months.
These investments currently yield approximately 5% annually.
Buffett’s choice reflects his consistent financial strategy of maintaining liquidity and safety, securing modest but reliable returns in uncertain market environments.
Consequently, Berkshire Hathaway’s total cash and short-term investments have surged to an unprecedented $334 billion, predominantly invested in Treasury securities. This significant cash reserve positions Berkshire exceptionally well to quickly capitalize on future investment opportunities or manage any potential economic turbulence.
Continued Confidence in Select S&P 500 Stocks
Despite exiting broad-market ETFs, Berkshire Hathaway maintains significant holdings in numerous individual S&P 500 companies, including:
Bank of America (BAC) – Still central to Berkshire’s financial-sector holdings.
Coca-Cola (KO) – A classic Buffett favorite known for consistent dividends.
Kraft Heinz (KHC) – Reflecting Buffett’s preference for stable, cash-generative consumer staples.
Apple (AAPL) – One of Berkshire’s largest positions, representing roughly 6% of the entire S&P 500, indicating continued faith in selected technology leaders. Everyone knows that Apple can’t fail (sarcasm).
Nevertheless, Berkshire’s recent actions clearly reflect a shift toward greater conservatism.
For instance, the company’s cash and short-term investments grew dramatically to $325.2 billion by the end of the third quarter, nearly doubling from the previous quarter.
These increases further emphasize Buffett’s cautious, liquidity-oriented investment strategy in the current market environment.
Berkshire’s Major Stock Sales in Q4 2024
Beyond exiting ETFs, Berkshire notably reduced its positions in various significant holdings during the fourth quarter, reinforcing its cautious stance:
Bank of America (BAC): Reduced by 117.4 million shares
Nu Holdings (NU): Reduced by 46.3 million shares
Citigroup (C): Reduced by 40.6 million shares
Capital One Financial (COF): Reduced by 1.7 million shares
Formula One Group (FWONK): Reduced by 0.9 million shares
Charter Communications (CHTR): Reduced by 0.8 million shares
T-Mobile US (TMUS): Reduced by 0.3 million shares
Louisiana-Pacific (LPX): Reduced by 0.3 million shares
DaVita (DVA): Reduced by 0.2 million shares
Vanguard S&P 500 ETF (VOO): Completely exited, reducing by 0.04 million shares
SPDR S&P 500 ETF Trust (SPY): Completely exited, reducing by 0.04 million shares
Ulta Beauty (ULTA): Reduced by 0.02 million shares
These widespread reductions across sectors clearly illustrate Buffett’s cautious evaluation of current market valuations.
Market Expectations and Possible Impact on Monday
Given Warren Buffett’s significant influence on investor sentiment, increased volatility is expected when markets open on Monday.
Although these ETF sales occurred months ago, their disclosure can strongly impact investor psychology. Institutions and retail investors alike may adopt similarly cautious stances, potentially leading to intensified selling pressure.
However, this is not necessarily cause for alarm. Buffett’s actions reflect thoughtful prudence rather than a forecast of immediate market trouble. Investors should instead closely monitor the Treasury market, as large inflows into short-term Treasury securities may push yields downward temporarily.
Buffett’s selective retention of quality stocks within the S&P 500 suggests continued confidence in specific sectors and businesses. This selective caution is crucial: Buffett is not entirely bearish, but he is clearly discerning in his market outlook.
What I’m Personally Doing
I sold all of my S&P 500 the moment Buffett started liquidating Berkshire’s VOO shares, and I moved into 3-month T-bills, which I will extend. Remember that this is only a part of my multi-million Dollar portfolio.
The long-term investments (Fortress of Solitude and others) remain as they are.
Option Calls: I will be taking profits when I see them this week. But I will still focus on trading select Option Calls. Not all companies are going down during a recession. Common sense applies.
This is not financial advice, as I’m not your financial advisor, and everyone’s situation is different.
With every good wish, I remain
Yours sincerely in Christ,
Rev. Jack Roshi
Applied Mathematics Department, MIT
Lead Quant and Board Member, Alpha LLPOpinions are my own
Thanks for the write-up. I was talking to my older sister last week, and she told me that she had pulled entirely out of the market. I appreciated your insights and balance, and I decided that I would follow Buffet more than my sister. S&P500 exposure NOT in a predetermined model is being replaced with BRK/B.
Buffett made these moves months ago while the rest of us are just finding out now—the ultimate reminder that by the time news hits, smart money has already repositioned.