History Says Berkshire Hathaway Stock Holds Up When the Market Falls: It Beat the S&P 500 in 11 of 13 Down Years
2026-10-15 10:50
•Patrick Sanders •The Motley Fool
• ••••• Axe Cap view
Berkshire’s Defensive Edge: What It Means for South African Investors
Berkshire Hathaway historically outperforms in downturns, a trait worth noting as rand volatility looms.
Berkshire Hathaway’s record of outperforming the S&P 500 in 11 of 13 down years since 1965 isn’t just a statistic—it’s proof of how solid diversification and cash reserves can shield investors. For South African investors watching USD/ZAR swings, Berkshire’s $365 billion cash hoard is like a defensive hedge; it means the company can buy assets cheaply when others panic. While the rand often suffers during global sell-offs, companies on the JSE with strong balance sheets—think Standard Bank or Sanlam—can offer some similar resilience. Yet, Berkshire’s underperformance so far in 2026 after a strong market rebound reminds us that past defensive strength doesn’t guarantee outperformance in every scenario. If the dollar stays strong against the rand, South African investors should be wary about chasing growth stocks aggressively and keep an eye on quality counters with ample liquidity. this is just our opinion and not financial advice
Trim high-volatility JSE growth stocks and watch for buying opportunities in well-capitalised financials like Standard Bank and Sanlam. Use USD/ZAR moves as a risk gauge before adding more offshore exposure.
- Berkshire Hathaway (BRK.A/BRK.B)
- Standard Bank
- Sanlam
- USD/ZAR
- Strong USD continuing to weigh on rand and SA earnings
- Global risk appetite returning sharply, hurting defensive stocks
7/10
Berkshire Hathaway has outperformed the S&P 500 in 11 of 13 down market years since 1965, demonstrating resilience during market downturns. The company's diversified business portfolio, substantial cash reserves ($365.5 billion), and disciplined investment approach provide protection against market volatility, though it has underperformed in 2026 with only 3% gains versus the S&P 500's 14% rise.
Our take is based on reporting first published by The Motley Fool.