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Warren Buffet Reduces Berkshire’s Stake In Apple: Shares Drop By 11%

The legend investor Warren Buffet hosted Berkshire Hathaway’s annual meeting on Saturday, where he announced the decision to reduce the company’s stake in Tech Giant Apple. Later, he applauded Apple, saying it would remain Berkshire’s major holding as always.  

Warren Buffet, the celebrated investor and CEO of Berkshire Hathaway, is known for his meticulous moves in the share market, which are closely followed and analyzed. Hence, it came as a significant shock when Berkshire decided to sell 115 million shares of its major holding, Apple, this Saturday. This decision surely had a profound impact on Apple’s share price, dropping it by 11%.

As of March 2014, Berkshire owns shares of Apple worth $135.4 Billion, which was $174.3 Billion the previous year. Almost 13% of Buffet’s owned shares were sold, causing confusion among stakeholders.

However, Buffet was quick to reassure stakeholders that the decision was not a reflection of Apple’s performance. “We have sold shares, and I would say that at the end of the year, I would think it extremely likely that Apple is the largest common stock holding we have,” Buffet confidently stated.

He didn’t forget to pay tribute to his late friend and conglomerate, Charlie Munger. “One interesting thing is that Charlie and I looked at common stocks or marketable equities or the things that people love to look at as being businesses, and so when we own a Dairy Queen or whatever it may be, we look at it as a business. When we own Coca-Cola, American Express, or Apple, we look at that as a business. Now, we can buy really wonderful companies in the market as businesses — we can't buy all of their shares, we can't buy 90% or 80% or anything like that,” explained Buffet.

He even went on to praise Tim Cook's leadership and compared him to Apple's iconic hero, Steve Jobs. The founder of Berkshire further explained to stakeholders the necessity for more cash in hand due to the prevailing economic uncertainties. He also mentioned that the current rate of gain after tax is more favorable and he wanted to make the best use of this brief opportunity provided by the Government.

Currently, Berkshire Hathaway has a record-breaking $189 Billion as cash in hand, a testament to its prudent financial management.

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