Financial Services Association, September 13 (Editor Shi Zhengcheng) Berkshire management, which has always been known for its low profile, broke out a trend this week that caused a lot of discussion in the market: Ajit Jain (Ajit Jain), vice chairman of the company and in charge of the insurance business, abandoned more than half of Berkshire's holdings.

According to regulatory documents, Jahn sold 200 Berkshire Class A shares at a price of 695417.65 US dollars on September 9, which is equivalent to cashing out 0.139 billion US dollars (equivalent to 0.99 billion yuan).

After completing this deal, Jahn still holds 61 Berkshire Class A shares in his hands. In addition, his family trust also holds 55 shares, and the non-profit organization Jain Foundation still has 50 shares. In other words, Jahn sold close to 55% of his holdings on Monday.

Much debate: What happened to Berkshire?

After experiencing ups and downs in the early stages of his career, Jahn left India to further his studies in the US, and moved from McKinsey to Berkshire in 1986, a job that continues to this day. Under his leadership, Berkshire successfully entered the reinsurance industry and completed the transformation of the auto insurance business Geico.

In 2014, Buffett publicly announced that both Jain and Abel would be his qualified successors (in the end, he chose Abel), and in January 2018, he was promoted to Vice Chairman of the Insurance Business and joined the board of directors at the same time. Afterwards, the two also began to walk in front of the stage and sit on the stage of Berkshire's annual shareholders' meeting.

In response to the reduction in holdings, some media called Jahn, but he declined to respond. As always, Berkshire remains silent, leaving comments from the outside world.

Among the many speculations, the two most popular ones are the valuation theory and the retirement theory.

The stock price of Berkshire Class A shares increased by nearly 24% this year, outperforming the S&P 500 index and many technology growth stocks, and breaking the 1 trillion dollar market capitalization milestone for the first time in August this year.

In line with stock sales, Berkshire's buyback movement has also begun to slow down markedly. Listed companies only repurchased shares of 0.345 billion US dollars in the second quarter of this year, which is far below the average of 2 billion US dollars in the previous two quarters. Buffett has repeatedly stated before that the buyback is because the stock price is lower than the intrinsic value, but the latest move may indicate a change in the opinion of the “stock god.”

Bill Stone, chief investment officer of Glenview Trust, which holds Berkshire shares, explained that Jain's sale of shares can only be considered a sign that the stock is no longer cheap. The current situation, which is close to 1.6 times the net market ratio, is probably close to Buffett's conservative estimate of intrinsic value. Stone doesn't expect Berkshire to make a large number of repurchases at the current price, or any buyback actions.

Of course, what is overshadowed by the image that Buffett is 94 and still dominating Wall Street is that Jahn is now 73 years old.

When Buffett announced that Abel was the heir, the core reasons generally believed by the outside world included that Abel was 11 years younger than Jahn. However, at last year's shareholders' meeting, Buffett publicly stated that there was no competition between Abel and Jain, and Jahn “never thought about managing Berkshire.”

Due to the uncertainty of the “post-Buffett era,” investors have also been worried about whether Jahn will stay with the company after Abell takes over as CEO of Berkshire.