To The Moon

As of mid-March 2026, the CBOE Volatility Index (VIX) sits at 24.58 — up sharply from its previous close and well above its long-term average — amid rising energy prices, geopolitical tensions, and broader economic unease. Headlines warn of “panic gripping the stock market,” with investors bracing for more turbulence. In such environments, many turn to defensive plays. One name that frequently surfaces is Berkshire Hathaway (NYSE: BRK.B), the conglomerate built by Warren Buffett and now led by Greg Abel. At $492.21 (up 0.44% on the day, with a year-to-date gain of 2.08% and a 1-year return of 4.35%), does Berkshire deserve a closer look when fear dominates?

What Makes Berkshire DifferentBerkshire Hathaway is no ordinary stock. It operates a vast portfolio of wholly owned businesses — insurance (GEICO, Berkshire Hathaway Reinsurance), railroads (BNSF), utilities, energy, consumer goods (Duracell, Dairy Queen, See’s Candies), and more — plus a substantial equity portfolio. Its low beta of 0.69 means it historically moves less dramatically than the broader market. This structural diversification and conservative capital allocation have earned it a reputation as a “safe-haven” stock during uncertain times.

The Cash Fortress: A Unique Edge in VolatilityBerkshire’s greatest weapon right now is liquidity. It ended 2025 with roughly $373 billion in cash and short-term Treasury bills — one of the largest corporate cash piles in history — even after some deployment. That war chest (still enormous into 2026) gives management the ability to pounce when asset prices fall. Buffett’s famous mantra — “be fearful when others are greedy and greedy when others are fearful” — is literally baked into the balance sheet. In past crises (2008–09, the 2020 COVID crash), Berkshire used cash to buy high-quality assets at discounted prices while competitors retrenched.

Proven Resilience, Not Perfect CorrelationBerkshire is not a pure hedge — it remains positively correlated with the S&P 500 over most periods. Yet its track record shines in turbulence. Over the past five years (through early 2026), BRK.B returned approximately 104% versus the S&P 500’s 74%. Its lower volatility profile has led analysts to rank it among the “best low-volatility stocks” to own. Portfolio managers have explicitly called it a “top defensive investment play” when trade policy or macroeconomic shocks create swings.Even in the current environment, Berkshire has held up better than many growth-heavy indices. While the S&P 500 has shown mixed or slightly negative year-to-date performance amid volatility, BRK.B sits modestly positive — illustrating the value of its steady, multi-industry earnings power.

The New Chapter Under Greg AbelWarren Buffett stepped back in late 2025, handing the reins to Greg Abel. Early signals are reassuring: Abel has emphasized disciplined capital allocation and risk management. Berkshire continues its long-standing practice of opportunistic share repurchases when shares trade below intrinsic value and maintains its no-dividend policy to reinvest in the business. Succession risk, once a major concern, appears well-managed.

The Counterarguments — It’s Not a PanaceaNo investment is risk-free. Berkshire has underperformed the S&P 500 during strong bull markets (for example, trailing over the past 12 months as tech and growth stocks surged). Its sheer size ($1.06 trillion market cap) makes outsized returns harder to achieve. Climate exposure in its insurance and energy operations draws ESG criticism. And while the cash pile is a strength, it currently earns only modest Treasury yields — a drag if markets stay buoyant.A Rational Choice for Patient InvestorsIn periods of elevated VIX, spiking uncertainty, and market swings, Berkshire Hathaway offers a compelling mix of downside protection, opportunistic firepower, and long-term compounding. Its lower beta, massive liquidity, and diversified earnings stream make it less likely to crater when sentiment sours — while still participating in eventual recoveries.For long-term, conservative investors who value stability over chasing the latest hot sector, buying Berkshire during volatility aligns with Buffett’s own playbook: stay disciplined, ignore the noise, and let time and capital allocation do the heavy lifting. It is not a short-term trade or a guaranteed hedge, but a proven business built for exactly the kind of uncertain environments we face today.