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8 times Warren Buffett called the stock market right.

general :: 2025-04-09 :: source - quartz

By Shannon Carroll

Photo: Mark Wilson (Getty Images)

For his next venture, Warren Buffett might consider selling a crystal ball.

Buffett, the billionaire chairman and CEO of holding company Berkshire Hathaway (BRK.A) known as the “Oracle of Omaha,” has made another move that makes it look like he can see into the future. For the past two years, his company has been stockpiling cash and selling stocks, meaning Berkshire remains in strong financial shape as the rest of the market is in tumult as a result of President Donald Trump’s tariffs.

In 2024, Berkshire sold $134 billion in equities and was sitting on a record $334 billion pile of cash, Treasury bills, and other liquid assets at the end of the year.

One of Berkshire’s big moves was slashing its stake in Apple (AAPL) by about two-thirds — Berkshire had spent $40 billion from 2016-23 on Apple’s stock. Apple stock is off 23% since its high last summer and 31% from its post-election peak because of how the tariffs are expected to affect China, a top manufacturer of Apple parts.

While other billionaires have seen their net worths plummet in the wake of Trump’s tariff announcement, Buffett’s fortune has grown by more than $11 billion.

Buffett has famously said, “When the tide goes out, you see who’s been swimming naked.” Another Buffett-ism: “Predicting rain doesn’t count. Building arks does.” Over the course of his financial career, he’s done just that. Here are other times he got the markets dead-on.

6 percent returns

In 1999, Buffett said the stock market returns for the next 17 years would be nothing like the stock market returns from the previous 17 years, which had been on a huge upswing. He said the “most probable return” over the next 17 years would be 6%. In 2016, at the end of that period, stocks had returned 5.9%.

Index funds over hedge funds

In 2007, Buffett bet $500,000 that, over the next 10 years, the S&P 500 Index would outperform a hedge fund portfolio (when fees were included). Buffett won the bet in lopsided fashion, with hedge-fund manager Ted Seides conceding before time was up. Seides’ funds had earned 2.2% per year, while the S&P 500 index had earned more than 7%.

The dot-com bubble

In the late ’90s, Buffett refused to invest in tech stocks because he didn’t understand their business models and didn’t think the companies could continue their torrid pace. At the time, he was criticized for being out of touch. When the dot-com bubble burst and high-flying tech stocks collapsed, Buffett’s position looked a lot smarter.

Bank of America

In 2011, when Bank of America (BAC) was still reeling from the fallout of the subprime mortgage crisis (trading below $7 per share, compared with $19 the year before), Buffett spent $5 billion on preferred shares. Those shares paid a 6% yield, resulting in $336 million in annual dividend payments to the company. When Berkshire exercised the warrants in 2017, the company earned $12 billion.

Goldman Sachs

In September 2008, Goldman Sachs (GS) was in a world of hurt after the financial crisis. Buffett invested $5 billion in the investment bank and reportedly made an eventual profit of over $3 billion.

Coca-Cola

One of Buffett’s big moves came in 1988, when he bought into Coca-Cola (KO), which was trading at $2.39. Earlier this month, stocks were trading at $73.18. At one point, Berkshire had a 9% stake in the company.

The airline industry

When the COVID-19 pandemic hit, Buffett saw the writing on the wall when it came to the airline industry. In 2020, Berkshire sold all of its airline holdings, citing the uncertainty of recovery. (In 2016, the holding company had invested around $7 billion to acquire roughly 10% stakes in Delta, American, United, and Southwest Airlines (LUV)).

While the airline industry has rebounded, it remains volatile and has underperformed compared with the larger post-pandemic recovery.

Berkshire Hathaway

One of Buffett’s most legendary financial moves came in the company he now runs, Berkshire Hathaway. In 1962, he began buying shares when it was a struggling textile company. In 1964, he had a deal in place to sell shares back to the company for $11.50 each. But when the official offer came in, it was different than the parties had agreed upon, so Buffett instead decided to buy more shares to get control of the company. He fired the CEO and took over, turning the textile company into a holding company.

Berkshire Hathaway has never declared a stock split, and a single Class A share now goes for almost $750,000.

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Source: quartz

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