I Was Shocked at Who Is Now Running Berkshire Hathaway's $308 Billion Stock Portfolio

As Warren Buffett hands over the reins of conglomerate Berkshire Hathaway (NYSE: BRKA) (NYSE: BRKB), questions abound about who will really manage the company's $308 billion equity portfolio and deploy its $373 billion in cash and short-term Treasury bills.

Over a decade ago, Buffett hired Todd Combs and Ted Weschler, both former hedge fund managers, and tasked them with managing a small portion of Berkshire's overall stock portfolio.

After Buffett announced his retirement and Combs departed Berkshire late last year, I had thought Weschler would run the bulk of Berkshire's public stock investments going forward. However, new CEO Greg Abel's first letter to shareholders seemed to indicate something quite different.

Abel to wear all the hats?

In his first letter to shareholders, Greg Abel went through Berkshire's businesses in great detail -- actually, much more detail than Buffett himself usually did. Abel came up through Berkshire via MidAmerican Energy, Berkshire's energy and utility operation, so it was not a surprise to hear him go through Berkshire's owned operations so thoroughly. But when Buffett handed over the CEO job to Abel, many, yours truly included, believed Abel would run the operating businesses at Berkshire, while Weschler would manage the stock portfolio.

However, that doesn't appear to be the case. In Abel's letter, he writes:

At Berkshire, equity investments are fundamental to our capital allocation activities; responsibility ultimately resides with me as CEO. Ted Weschler manages about 6% of our investments, including a portion of the portfolio formerly overseen by Todd Combs. Ted's impact extends beyond these investments, as he continues to play a broader role in assessing significant opportunities, providing valuable input on our businesses, and supporting Berkshire in various other ways.

It appears that Abel, not Weschler, will be primarily responsible for the other 94% of Berkshire's core equity holdings. Now, it goes without saying that Weschler would still likely be consulted on any large stock purchase; however, one might have thought that Weschler would have been allocated a much larger share of the portfolio to manage.

Abel doesn't have any stock-picking experience

It's a pretty interesting turn of events, at least in this investor's eyes. After all, Greg Abel has never managed a public equity portfolio before.

He started his career as a consultant at accounting giant PricewaterhouseCoopers (PwC) and soon began working with utility company CalEnergy as a client. Abel then became an auditor for CalEnergy and later joined as an executive.

In 1999, he was named president of CalEnergy, just before the company was acquired by Berkshire and renamed MidAmerican Energy. In 2008, he was promoted to CEO of MidAmerican under Berkshire's ownership.

Buffett was so impressed with how Abel ran MidAmerican that he subsequently promoted Abel to oversee all of Berkshire's operating businesses and later named him as his successor to the CEO role.

Image source: The Motley Fool.

Will Berkshire shy away from stocks altogether?

Berkshire hasn't made any big stock market bets over the past decade, really not since its Apple investment, which happened all the way back in 2016. The more significant public stock market bets since then have been in large oil giants, which seem more like strategic hedges against geopolitical risks, as we're seeing now. Meanwhile, Berkshire's recent bet on Chubb is much smaller than the Apple investment and is within the insurance industry, which is essentially Berkshire's core operating business.

In other words, even Berkshire's recent stock market picks are generally smaller and within the same industries as Berkshire's main operating businesses -- insurance and energy.

Rather than stocks, most of Berkshire's activity in recent years has been through whole-company acquisitions in those same industries. In 2022, Berkshire acquired Alleghany Corporation, a property and casualty insurer. In 2023, Berkshire acquired a controlling interest in Pilot Travel Centers and also a controlling stake in the Cove Point liquefied natural gas (LNG) export facility. In 2025, Berkshire purchased OxyChem, Occidental Petroleum's chemicals business, which will likely be folded into Berkshire's existing Lubrizol subsidiary.

All these acquisitions are in Berkshire's wheelhouse in that they are within the company's circle of competence: insurance, energy, industrials, and a little retail. While Buffett has long said he prefers to buy businesses outright rather than own parts of businesses in the stock market, Abel's assumption of responsibility suggests Berkshire may lean even more heavily on whole acquisitions related to its existing operating businesses, rather than stocks, going forward.

Is this a good or bad thing for shareholders?

Remember, Berkshire isn't a hedge fund; it's an operating business that also happens to make investments. And while Buffett used his stock market smarts to boost the returns of Berkshire's insurance float in the past, Berkshire may lean more heavily on acquiring whole businesses than stock-picking going forward.

Still, investors shouldn't expect Berkshire to abandon stock picks entirely. Weschler is still at the company, and it's possible that Abel eventually makes a consequential stock market buy at some point. After all, Warren Buffett himself once said, "I am a better investor because I am a businessman, and a better businessman because I am an investor."

Billy Duberstein and/or his clients have positions in Apple and Berkshire Hathaway. The Motley Fool has positions in and recommends Apple and Berkshire Hathaway and is short shares of Apple. The Motley Fool recommends Occidental Petroleum. The Motley Fool has a disclosure policy.