Warren Buffett's $863 Million "Secret" Portfolio Dumped Alphabet and Broadcom, but Has Over 17% of Invested Assets in This Proven Moneymaking Strategy

Berkshire Hathaway subsidiary New England Asset Management cut its Broadcom stake by 97% and its Alphabet Class A stake by 48% in the quarter ended June, while holding about $149 million—17.3% of its $863 million portfolio—in SPY and VOO. The article notes concerns about AI-driven valuation risk but cites historical data showing all 107 rolling 20-year S&P 500 periods since 1900 generated positive average annual total returns. The portfolio activity is attributed to NEAM, not directly to Warren Buffett.

Analysis

The key signal is not an alleged Buffett verdict on AI: NEAM is a Berkshire subsidiary with its own investment team, so its quarterly trades are weak evidence of Buffett’s or Berkshire’s central portfolio view. The reported reductions may reflect routine portfolio management, and their market impact on AVGO or GOOG should be negligible absent evidence that the holdings were materially larger than described. Do not treat this filing as a standalone short catalyst.

The more useful second-order point is that SPY and VOO are not an AI-bubble hedge. Both track the S&P 500 and therefore retain exposure to its largest technology constituents; a broad-index allocation can soften single-stock risk while still participating in a correlated mega-cap selloff. Historical rolling returns do not eliminate drawdown, valuation, or holding-period risk.

Horizon: Over days, expect little fundamental impact from NEAM’s sales. Over 1–3 months, watch AI capex commentary, cloud demand, and semiconductor supply/customer guidance for evidence that spending is translating into durable revenue rather than circular investment. Over 6–18 months, a slowdown in AI infrastructure orders could pressure AVGO and parts of the supply chain, while index concentration could amplify broad-market losses. The thesis weakens if customers sustain or increase capex and reported AI-related demand converts into revenue and cash flow; it strengthens on capex cuts, order pushouts, or guidance reductions. The contrarian point: selling individual AI names while holding broad index funds may look like a risk-on/risk-off call, but it can simply be asset allocation—not a forecast.

Key Decisions for Investors

• No trade in AVGO, GOOG, or BRK.A solely on NEAM’s reported activity; the manager attribution and position scale do not support a high-conviction signal.
• For existing AI-heavy exposure, assess look-through concentration in SPY/VOO before treating either fund as diversification. Reduce aggregate exposure only if it exceeds portfolio risk limits, not because of this filing.
• Set a 1–3 month watch alert for material downward revisions to AI-related orders, customer capex, or company guidance at AVGO and GOOG; those would be more actionable than the subsidiary’s sales.
• Do not extrapolate the historical rolling-return record into a near-term floor. Revisit broad-index risk if valuation-sensitive market leadership narrows or mega-cap earnings expectations begin to fall.