Warren Buffett’s company ,Berkshire Hathaway, has finally been elected to enter the S&P500, causing at least a short term uplift in the stock price as index funds (with cumulative assets of over $1trillion) scramble to buy around 6-7% of the company so they can reflect the complete index.
According to some reports, in after-hours trading BRK stock has jumped 8.5-9% with the A-class share trading at $111,000 and the B-class share at $73.80.
Index funds may give Berkshire shares stability, Buffett told shareholders last week.
“You’ve got a permanent stockholder for 6 or 7 percent of your shares,” Buffett said. “We like permanent shareholders. That’s exactly what we’re looking for.”