Danielle Liverance
4 min read
Quick Read
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BRK-B trailed the US market by just 3 basis points annualized over 24 years, a margin so thin that it reverses depending on the measurement date.
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Berkshire’s cash pile grew from $147 billion to $373 billion between 2021 and 2025, mechanically dragging returns below VTSAX during a surging equity market.
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Felix recommends rolling 5- or 10-year windows over fixed date snapshots to avoid reverse-engineering performance comparisons to fit a thesis.
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Warren Buffett is the most celebrated investor alive, but a fresh analysis from the Rational Reminder Podcast delivers an uncomfortable finding: across roughly the last 24 years, Berkshire Hathaway (NYSE:BRK-B) has lagged the total US stock market. The lesson buried inside that statistic is more important than the headline itself.
The Felix Finding: A Comparison Hostage to Dates
On episode #414 of the Rational Reminder Podcast (“Answering Your Financial Questions”), portfolio manager Benjamin Felix revisited a claim he made on episode 335: that Berkshire had underperformed VTI for 22 years ending October 2024. A listener re-checked the math on March 10, 2025 and found the opposite result. Felix then ran the numbers again with data through May 22, 2026, and found Berkshire had again underperformed VTSAX by roughly 3 basis points annualized over about 24 years starting January 1999.
Three basis points is a rounding error, and that is the point. The result flips based on the day you measure it. Our own pull of the data illustrates how fragile these snapshots can be: BRK-B is up 1,080.67% since November 1, 1999, while VTI has returned 216.81% since its May 31, 2001 inception. Different starting points, different stories.
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Buffett himself has acknowledged that cash has “hurt them while US stocks have gone on just an absolute tear”. And going forward, the comparison gets even more complicated: Buffett stepped down as CEO at the end of 2025, so any returns from here reflect Greg Abel’s leadership, not Buffett’s stock-picking.
The Crucial Mistake: Underestimating Cash Drag
The structural force behind Berkshire’s recent lag is cash drag. When a portfolio holds large idle cash balances while equities compound, the cash mechanically pulls down the total return. Treasury bills are wonderful when the market crashes. They are a serious headwind when the market melts up.
