After the close of the US stock market this week, they submitted a shareholding declaration to the US Securities and Exchange Commission, disclosing that they have sold nearly $1.5 billion in stocks in the past week. This is also the first time Buffett has reduced his holdings on this long-term "favorite stock" since the third quarter of 2020. Munger revealed afterwards that Berkshire's people directly called the customer service center of Bank of America, requesting to "speak with the CEO", but obviously the customer service did not pay attention to such a request. Later, Berkshire's financial director contacted Munger through Wall Street's private relations. Unlike trading overseas stocks, Buffett often buys and sells when trading US stocks, and does not necessarily "sell all the way to the bottom". So Buffett also "made T" in Bank of America's stock many times. According to transaction data statistics, after making a big profit in 2017, Buffett added nearly 0.27 billion shares in four separate transactions in 2018 and 2019, and then reduced 45.6 million shares during the US stock market crash in the third and fourth quarters of 2019 (including buying back 20 million shares). After the heavy blow of the new crown epidemic to the US stock market ended in early 2020, Buffett increased his holdings significantly in July 2020, buying more than 0.1 billion shares in four separate transactions. Subsequently, in the third quarter of 2020, Buffett sold 22.8 million shares, and this transaction can be said to be the "last moment of selling before the stock price takes off". By the first quarter of 2023, Buffett bought back all the 22.8 million shares he sold two and a half years ago in the price range of 26-36 US dollars, which was also the last transaction before this week's transaction.$Berkshire Hathaway-B (BRK.B.US)$After the close of the US stock market this week, they submitted a shareholding declaration to the US Securities and Exchange Commission, disclosing that they have sold nearly $1.5 billion in stocks in the past week.$Bank of America (BAC.US)$This is also the first time Buffett has reduced his holdings on this long-term "favorite stock" since the third quarter of 2020.

According to the announcement, Berkshire Hathaway sold 33.89 million shares of Bank of America's stock in four separate transactions between Wednesday and Friday of this week, at prices ranging between $43.12 and $44.06, for a total reduction of approximately $1.476 billion.

After the transaction, Berkshire Hathaway still owns 0.9989 billion shares of Bank of America's stock, worth over $42.8 billion, still the second largest holding in Berkshire Hathaway's investment portfolio after Apple.

Buffett's selloff coincided with the recent trend of "rotation trading" in the US stock market. Many funds that made huge profits poured out of technology giants and increased their positions in value blue-chip and small-cap stocks. Although Bank of America did not hit a new high like Goldman Sachs and JPMorgan, its stock price also rose to a two-and-a-half-year high. Starting from October 2023, Bank of America's cumulative increase in this round of growth exceeds 75%.

From 'Mountain Top Standby' to 'Wall Street Fable'

Similar to Buffett's investment in Apple, Berkshire Hathaway's investment in Bank of America is also a classic "Wall Street value investment fable".

Buffett's this week's sale of stocks can be traced back to 2011, when Berkshire Hathaway invested $5 billion in Bank of America, which had experienced the financial crisis. They received preferred stocks with an annual interest rate of 6% and the right to convert into 0.7 billion shares of common stock at $7.14 per share, with a term of 10 years.

At that time, Bank of America's stock price was in a continuous decline and fell to $6 during the trading week when the deal was announced. The share price rose to above $8 after the announcement of the 'Buffett transaction,' but then continued to decline for nearly four months, hitting a bottom of just below $5 by the end of 2011.

Like the investment in Apple, Buffett's real moment of glory in Bank of America came in the summer of 2017, when Berkshire Hathaway announced that it would execute the right to swap in that year. Since Bank of America's stock price had already risen to $24 at that point, Buffett netted more than $12 billion on the exercise alone. This transaction also made Berkshire Hathaway the largest shareholder of Bank of America, a position it holds to this day.

As the title suggests, before the 2011 entry into the investment history books, Buffett had also stumbled on Bank of America's stock.

According to historical statistics, Berkshire Hathaway's first purchase of Bank of America's stock was in the second quarter of 2007. At the time, the market was on the verge of a wealth bubble burst, and Buffett bought nearly 8.7 million shares of Bank of America's stock at a price of nearly $50, and further increased his position in the third quarter. However, as the market began to decline, Buffett first cut his position in half in the third quarter of 2008, and then held the remaining shares until the fourth quarter of 2010, when he sold them all at a price of nearly $10.

So Buffett's $5 billion dollar bet in 2011 was also somewhat related to his previous experience of "standing guard on high ground." According to Buffett himself, he had the inspiration for this investment "when taking a bath" and then found a way to contact Bank of America's CEO Brian Moynihan.

Munger revealed afterwards that Berkshire's people directly called the customer service center of Bank of America, requesting to "speak with the CEO", but obviously the customer service did not pay attention to such a request. Later, Berkshire's financial director contacted Munger through Wall Street's private relations.

Unlike trading overseas stocks, Buffett often buys and sells when trading US stocks, and does not necessarily "sell all the way to the bottom". So Buffett also "made T" in Bank of America's stock many times.

According to transaction data statistics, after making a big profit in 2017, Buffett added nearly 0.27 billion shares in four separate transactions in 2018 and 2019, and then reduced 45.6 million shares during the US stock market crash in the third and fourth quarters of 2019 (including buying back 20 million shares).

After the heavy blow of the new crown epidemic to the US stock market ended in early 2020, Buffett increased his holdings significantly in July 2020, buying more than 0.1 billion shares in four separate transactions. Subsequently, in the third quarter of 2020, Buffett sold 22.8 million shares, and this transaction can be said to be the "last moment of selling before the stock price takes off".

By the first quarter of 2023, Buffett bought back all the 22.8 million shares he sold two and a half years ago in the price range of 26-36 US dollars, which was also the last transaction before this week's transaction.

In contrast to trading overseas stocks, Buffett often buys and sells when trading US stocks, and does not necessarily "sell all the way to the bottom". So Buffett also "made T" in Bank of America's stock many times.

Editor/Emily