Warren Buffett’s Berkshire Hathaway Inc. (NYSE:BRK.B) took a position in Canada’s Barrick Gold Corp. (TSX:ABX) during the second quarter.
Berkshire Hathaway took a new position in Barrick Gold between the start of April and the end of June, buying 20.9 million shares, or 1.2% of the company’s outstanding stock, with a current market value of $565 million U.S., according to a quarterly regulatory filing with the Securities and Exchange Commission (SEC).
In the past, Buffett cautioned against investing in gold because it’s not productive like a farm or company. Now, the gold producers are benefiting from surging prices over the last year that are boosting profit margins as costs of production have steadied.
Barrick Gold’s shares rose 7.4% in after-hours trading on Friday following news of Berkshire Hathaway’s stake in the company. Gold has gotten a boost as U.S. Federal Reserve interest-rate cuts and a plunge in government bond yields lifted demand for the precious metal, which doesn’t offer interest.
Also during the second quarter, Berkshire Hathaway increased its holding of Bank of America (NYSE:BAC) stock, trimmed its holding of JPMorgan Chase (NYSE:JPM) stock and exited its entire position in investment bank Goldman Sachs (NYSE:GS).
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