Berkshire Hathaway has exited its entire position in BYD, terminating a 17-year investment that was notably profitable in Asia. The full divestment comes after Berkshire gradually reduced its stake since 2022, with BYD acknowledging its role as a long-term supporter.
As reported by CNBC’s Warren Buffett Watch, Berkshire Hathaway Energy, the division holding the shares, marked the investment as zero by March 31. A spokesperson has confirmed that the entire position has been sold. BYD’s head of public relations expressed gratitude for Berkshire’s backing since 2008.
Berkshire began reducing its BYD holdings in 2022, and by mid-2024, their stake had decreased to below 5%. The final exit this year marks the end of one of Berkshire’s most profitable investments in the Asian market.
With the confirmation that Berkshire Hathaway has fully exited its position in BYD, derivative traders should anticipate increased downward pressure on the stock. This news, while expected due to the gradual sell-down since 2022, removes a key long-term validation for the company. We would consider buying put options expiring in the next 30 to 60 days to capitalize on this renewed negative sentiment.
This move comes as the broader EV market is showing signs of slowing growth, adding credibility to a bearish outlook. Recent reports from mid-2025 have shown global EV sales growth has cooled to approximately 15% year-over-year, a significant drop from the over 25% growth rates we saw in 2024. This market maturation makes high-valuation stocks like BYD particularly vulnerable to negative catalysts.
The finality of the exit will likely cause a spike in implied volatility for BYD options. We see this as an opportunity for strategies that benefit from price movement, but a simple purchase of puts seems most direct. Historically, when a respected “whale” like Berkshire completely divests, it often triggers a re-evaluation across the market that can depress a stock’s price for several quarters.
We can look back at the sustained pressure on Chinese technology stocks between 2021 and 2023 after major international funds began reducing their exposure. That period showed us that such a significant investor exit is not a one-week event but can signal a longer-term trend. Therefore, traders might consider longer-dated puts or establishing put debit spreads to manage costs while betting on a continued slide.
The fallout will likely extend beyond just BYD, affecting sentiment for the entire Chinese EV sector and related supply chains. We anticipate traders will use this event as a signal to short an index of Chinese EV makers or buy puts on competitors like Li Auto and Nio. This move by Berkshire could be interpreted as a broader commentary on geopolitical risks and peak growth in that specific market.
