After 60 years of turning a little textile company called Berkshire Hathaway into a US$1.2 trillion investment juggernaut, Warren Buffett is hanging up his trading hat.
What happened: The 94-year-old GOAT of the investment world announced that he will retire as CEO of Berkshire by the end of the year — and his pick to succeed him is Edmonton native Greg Abel.
- The surprise announcement at Berkshire’s annual shareholder meeting will end Buffett’s tenure as the longest-serving head honcho of an S&P 500 company.
Catch-up: Abel has been at Berkshire since 1992 and has long been Buffett’s choice to take the reins when the time came. He’s led the company’s noninsurance businesses for years and has been praised by Buffett for his business chops and his fit with the Berkshire culture of long-term thinking.
Why it matters: You’d be hard-pressed to find bigger shoes to fill than Warren Buffett's. No one on Wall Street has beaten the market by as wide a margin as Berkshire Hathaway has over the past six decades.
- Under his leadership since 1965, Berkshire’s 20% average annual returns have doubled the S&P 500’s performance.
What’s next: Abel’s first job will be to figure out what to do with the nearly US$350 billion of cash Buffett has accumulated over the past several years while waiting out a volatile market.—LA