Finding the right stock to invest in can be tricky in the current climate. Following the example of significant speculators like Warren Buffett carries risks but can be worthwhile. As such, Apple stock remains crucial for any portfolio, but banks can be let go.
The opinions of Warren Buffett will always divide the world. Some think he is a financial genius, whereas others consider him shortsighted regarding cryptocurrencies. Regardless, his investment appetite is often a good indicator for other stock traders. When his company buys shares in a particular company, everyone eventually notices.
In the previous quarter, Berkshire Hathaway decided to increase its holdings of Apple stock (AAPL). An exciting development, although not too surprising. The tech giant notes success since its M2 chip launch, and people are excited to upgrade their hardware. In addition, new devices are expected to be announced soon, including a rumored 15.5″ MacBook Air.
It is not uncommon for Berkshire Hathaway to invest in AAPL. The company already owns a large sum of stocks and added almost 21 million more throughout Q4 2022. That brings its portfolio to over 915 million Apple shares. Moreover, Berkshire is the second-largest holder of AAPL stock, behind The Vanguard Group.
In the same period, Buffett’s firm decided to reduce exposure to various other stocks. Those include the Bank of New York Mellon and US Bancorp in the finance sector. The firm also sold stock in Taiwan Semiconductor, a prominent computer chip maker. However, computer sales have decreased exponentially, and most manufacturers relying on hardware from TS have adjusted their sales forecast.
That said, the Taiwan Semiconductor sell-off is remarkable. Berkshire Hathaway only announced a 60 million-share stake in the firm three months prior. Following the sell-off, that position decreased to 8.3 million shares. It may dwindle further over the coming months unless computer chip sales pick up again.
A similar steep reduction was noted regarding US Bancorp, which dropped from 52.5 million shares to 6.7 million.
Investing in technology manufacturers like Apple and Microsoft will likely remain the way to go for risk-averse stock investors. Other companies are subject to increased market volatility for various reasons. Buying bank stocks may be one of the least favorable options in the current financial climate.