Ever wondered what it’s like to own a piece of Warren Buffett’s empire? Berkshire Hathaway, the conglomerate behind some of the world’s most iconic businesses, offers two distinct ways to invest: Class A and Class B shares. These two share classes, while tied to the same legendary company, cater to different types of investors with wildly different price tags and perks. Let’s dive into the fascinating world of Berkshire Hathaway’s stock structure and uncover what sets these shares apart.
Why Berkshire Hathaway Offers Two Share Classes
Berkshire Hathaway’s dual share structure isn’t just a quirk—it’s a deliberate strategy rooted in accessibility and investor philosophy. Understanding why these two classes exist is the first step to deciding which might fit your portfolio. From protecting the company’s reputation to making shares affordable, the story behind Class A and Class B shares is as intriguing as the Oracle of Omaha himself.
The Origins of Class A Shares
Berkshire Hathaway’s Class A shares are the original stock, launched when the company was still a textile manufacturer. Over decades, under Warren Buffett’s leadership, these shares transformed into a symbol of long-term wealth creation. Today, they’re known for their jaw-dropping price—think hundreds of thousands of dollars per share. This isn’t just a number; it’s a reflection of Buffett’s refusal to split the stock, ensuring only serious, long-term investors join the ride.
“I want investors who are in it for the long haul, not chasing quick profits.”
– Warren Buffett, paraphrased from shareholder letters
This philosophy has kept Class A shares exclusive, attracting institutional investors and high-net-worth individuals who share Buffett’s buy-and-hold mindset. But what happens when the average investor wants in? That’s where Class B shares come into play.
The Birth of Class B Shares
Back in the mid-1990s, Berkshire’s stock price was already climbing to dizzying heights, pricing out smaller investors. At the time, some financial firms saw an opportunity to create unit trusts—investment vehicles that would bundle Berkshire shares and sell fractional stakes to the public. Sounds great, right? Not to Buffett. He worried these trusts would charge hefty fees, mislead investors, and tarnish Berkshire’s reputation.
In 1996, Buffett and the board took action, introducing Class B shares to offer a more affordable entry point. Initially priced at 1/30th of a Class A share, these “Baby Berkshires” opened the door to retail investors. A 50-to-1 stock split in 2010 further lowered the price, making each Class B share 1/1,500th of a Class A share. Suddenly, owning a piece of Buffett’s empire became achievable for everyday investors.
Key Differences Between Class A and Class B Shares
While both share classes grant ownership in Berkshire Hathaway, they differ in price, voting rights, and flexibility. Let’s break down the core distinctions to help you decide which aligns with your investment goals.
Price and Accessibility
The most glaring difference is the price. As of April 2025, Class A shares trade at a staggering $760,000+ per share, making them one of the priciest stocks on the market. In contrast, Class B shares hover around $430, offering a far more accessible option for retail investors. This price gap reflects the equity stake: one Class A share equals 1,500 Class B shares.
For most investors, Class B shares are the only realistic choice. Unless you’re sitting on a fortune, buying even a single Class A share is a pipe dream. But don’t worry—Class B shares still give you exposure to Berkshire’s diverse portfolio, from insurance to railroads to consumer goods.
Voting Rights
Here’s where things get interesting. Class A shareholders wield significantly more influence, with voting rights that dwarf those of Class B holders. Specifically, each Class B share carries just 1/10,000th of the voting power of a Class A share. For most retail investors, this isn’t a dealbreaker—few individuals sway corporate decisions at a conglomerate like Berkshire. But for institutional investors, the voting power of Class A shares is a major draw.
Personally, I find this setup fascinating. It’s a clear signal that Buffett prioritizes control for long-term investors while still welcoming smaller players to the table. It’s like being invited to a VIP party but with a guest pass instead of a full membership.
Conversion Options
Another key difference is convertibility. Class A shareholders can convert their shares into 1,500 Class B shares at any time, offering flexibility if they need to liquidate a portion of their holdings. However, the reverse isn’t possible—Class B shareholders can’t convert up to Class A without selling and repurchasing. This one-way street reinforces the exclusivity of Class A shares while keeping Class B as the accessible option.
Tax Benefits
Here’s a lesser-known perk of Class B shares: their lower price makes them ideal for gifting. In 2024, the IRS allows gifts up to $18,000 per recipient without triggering gift tax. With Class B shares, you can transfer a meaningful stake in Berkshire to family members without crossing this threshold. Try doing that with a single Class A share—it’s simply not feasible. This tax advantage adds a layer of practicality for estate planning.
| Feature | Class A Shares | Class B Shares |
| Price (April 2025) | $760,489 | $437.66 |
| Voting Rights | Full | 1/10,000th of Class A |
| Convertibility | Into 1,500 Class B | Not convertible to Class A |
| Accessibility | High-net-worth investors | Retail investors |
Pros and Cons of Each Share Class
Choosing between Class A and Class B shares depends on your financial situation and investment goals. Let’s weigh the advantages and drawbacks of each to paint a clearer picture.
Class A Shares: The Elite Option
Class A shares are the gold standard for Berkshire investors, but they come with a catch. Here’s what you gain—and what you give up.
- Pros: Slightly higher historical returns, full voting rights, no risk of stock splits diluting value.
- Cons: Astronomical price, limited flexibility for partial sales, inaccessible to most investors.
If you’ve got the capital, Class A shares offer a sense of prestige and influence. But for the average investor, they’re more of a dream than a reality.
Class B Shares: The People’s Choice
Class B shares are the practical alternative, designed for accessibility and flexibility. Here’s the breakdown.
- Pros: Affordable price, same long-term growth potential, flexibility to buy or sell smaller amounts.
- Cons: Lower voting power, slightly lower historical returns, potential for future stock splits.
I’ve always admired how Class B shares democratize access to Berkshire’s success. They let everyday investors ride the same wave as the big players, even if they’re in a smaller boat.
Why No Stock Split for Class A Shares?
Warren Buffett’s stance on stock splits is crystal clear: Class A shares will never be split. Why? He believes the high price filters out short-term speculators, attracting only those who share his long-term vision. It’s a bold move, and frankly, I respect the conviction. By keeping Class A shares exclusive, Buffett ensures Berkshire remains a haven for patient investors.
Meanwhile, Class B shares serve as the bridge to retail investors, balancing accessibility with Buffett’s core philosophy. It’s a masterclass in corporate governance, if you ask me.
Which Share Class Is Right for You?
Deciding between Class A and Class B shares boils down to your budget, goals, and investment style. Here’s a quick guide to help you choose:
- Choose Class A if: You’re a high-net-worth investor seeking maximum voting power and don’t mind tying up significant capital.
- Choose Class B if: You’re a retail investor looking for affordable exposure to Berkshire’s growth with flexibility to adjust your position.
For most readers, Class B shares are the way to go. They offer nearly identical exposure to Berkshire’s performance without requiring a second mortgage. But whichever you choose, aligning your investment with your financial goals is key.
The Bigger Picture: Investing in Berkshire Hathaway
Owning Berkshire Hathaway shares—whether Class A or Class B—is more than just a financial decision; it’s a vote of confidence in Warren Buffett’s legacy. The company’s diverse holdings, from Geico to Apple, provide stability and growth potential that few stocks can match. But it’s not without risks. Buffett himself has warned that past performance isn’t a guarantee of future results, especially as the company transitions to new leadership.
“Never invest in a business you don’t understand.”
– Warren Buffett
This advice rings true for Berkshire investors. Whether you’re drawn to the prestige of Class A or the practicality of Class B, take the time to understand the company’s structure and philosophy. It’s the surest way to make an informed decision.
Investing in Berkshire Hathaway is like buying a ticket to a long-term journey. Class A shares offer a first-class seat, while Class B shares provide a comfortable spot in economy—both get you to the same destination. By understanding the differences, you can choose the path that best suits your wallet and ambitions. So, which will it be for you?
