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RedDeerGuy1's avatar

Will Warren Buffett's Berkshire Hathaway stock go down to zero if he tries to sell a large amount?

Asked by RedDeerGuy1 (24945points) June 10th, 2018

So does that mean that Warren Buffett Is only rich in paper? That if he tries to sell a large amount that the stock would go down to zero? Is that why he lives frugally? That he doesn’t have spending cash, because every dollar he spends comes from Berkshire Hathaway stock?

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5 Answers

ARE_you_kidding_me's avatar

It’s a mutual fund comprised of many stocks, does not work that way.

RedDeerGuy1's avatar

@ARE_you_kidding_me Can you explain how it happens then? Thanks

elbanditoroso's avatar

No, not at all. The chances of it going to $0 are infinitesimal, anyway.

His stock of Berkshire Hathaway is at $294,000 per share. There isn’t a large market for that type of purchase, for certain. But if he dumped a lot on the market, it’s market price would go down for lack of demand. But it wouild not hit 0.

And it the main Berkshire Hathaway stock (BRKA) is not a mutual fund – the information above is incorrect.

It is a regular old stock that has never split.

ARE_you_kidding_me's avatar

Yeah you’re actually right about that. It’s like a mutual fund in the sense that it’s a holding company Purchasing that single stock is like purchasing shares in a managed, diversified mutual fund.

LostInParadise's avatar

Buffet is worth billions of dollars. Any financial need that he has would be a small fraction of that. He could sell off a million dollars worth of his stock and its value would not suddenly crash.

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