History Says Berkshire Hathaway Stock Holds Up When the Market Falls: It Beat the S&P 500 in 11 of 13 Down Years

Berkshire Hathaway, the company led by Warren Buffett, has consistently demonstrated strong performance compared to the S&P 500 during years when the broader market experienced declines. Since 1965, the stock has outperformed the index in 11 out of 13 years where the S&P 500 recorded negative returns. This impressive track record highlights Berkshire's ability to provide investors with protection against market downturns.

While the S&P 500 gained about 14% in 2026, Berkshire Hathaway's shares only increased by 3%. However, the company's unique business portfolio, consisting of various industries and its substantial cash reserves, enable it to generate value over time, even when the market is struggling. The company's diversified holdings, including well-known names like Apple, American Express, and Coca-Cola, as well as its cash position of $365.5 billion, provide Berkshire with multiple sources of earnings and cash flow.

This diversification, combined with its ability to invest in attractive opportunities during market declines, sets Berkshire apart from other stocks. Even though Berkshire Hathaway's performance in 2026 has been underwhelming compared to the S&P 500, it remains a compelling investment choice for those seeking protection during market downturns.