Outperformed the S&P by 19.2 percentage points in one month: Berkshire (BRK.B) achieves its highest monthly relative advantage since 2010, second only to the 2008 financial crisis

According to Zhitong Finance APP, as AI trading recedes and tech stocks teeter, one of the market’s oldest “safe havens” has once again proven its worth. Berkshire Hathaway (BRK.B) has just recorded one of its most notable relative surges in over a decade.

How rare is the data: Only three times exceeded in 30 years

In the past month ending last Thursday, the conglomerate outperformed the S&P 500 Index (SP500) by 19.2 percentage points—its largest rolling one-month relative advantage since 2010 and the fourth-largest gap in the past 30 years. Only during the turmoil of the 2008 financial crisis was the gap wider: back then, Berkshire led the market by 29.6 percentage points.

This divergence stems from a stark contrast in absolute performance: over the past month, Berkshire’s stock price rose 13.2%, reaching a record high; during the same period, the S&P 500 Index fell 3.7%. By Tuesday’s close this week, the gap between the two narrowed slightly to 16.9 percentage points, but this level still remains rare in the historical data since 1996.

In just half a year, the tide turned. As recently as May this year, Berkshire was trailing the S&P 500 Index by 14.3 percentage points—at that time, the market was immersed in the fervor of the AI-driven rally, and the tech-heavy index surged ahead, while Berkshire, driven mainly by insurance, railroads, and energy, appeared sluggish.

Why Berkshire: Cash, operating businesses, and “not betting on a single narrative”

This rapid reversal highlights how quickly market conditions can shift in favor of the company’s structural characteristics—a cash-rich balance sheet and a portfolio of established operating businesses.

The logic is simple: when market concerns shift from “Can AI grow even faster?” to “Can the huge debts of AI infrastructure be recovered?”, the anchor for valuations moves from dreams back to cash flow. Berkshire’s massive cash reserves, often criticized as “dragging on returns” in bull markets, become both a cushion against volatility and “dry powder” ready to deploy when risk appetite shrinks and credit spreads widen—the greater the market panic, the more valuable this cash’s option value becomes.

Meanwhile, operating profits from its subsidiaries like BNSF Railway, energy, and insurance are rooted in real economic demand, not reliant on the continuation of any single hot narrative. This week, AI-related assets—from chip stocks to computing power suppliers—saw volatility spike sharply, yet Berkshire’s profit structure has almost no direct exposure to this theme.

Viewed over a 30-year horizon, the current gap ranks only below the 2008 financial crisis—a period when “cash and certainty commanded a premium, while leverage and thematic assets were sold off.” History seems to point to a simple pattern: Berkshire’s excess returns are often realized not in bull markets, but when the market relearns respect for risk.

It’s worth noting that the persistence of this kind of relative advantage is highly dependent on market conditions continuing. If AI sentiment recovers and risk appetite returns, Berkshire’s gap with the broader market could narrow again, as it did on Tuesday. For investors, that 19.2 percentage point figure doesn’t record a company becoming stronger, but rather the market repricing “certainty” itself.