Why US pension fund trims Buffett exposure, bets on meme, pot stocks?

Highlights

• The pension had US$321.9 billion in assets as of Oct 31​, 2021, it disclosed to the US market regulator, the Securities Exchange Commission or SEC.
  
  
• Additionally, Calstrs bought 347,900 shares of Tilray in Q3. It didn’t have any Trilby stocks at the end of the second quarter.
  
  
• Calstrs’ total class B shares of Buffet’s firm stood at 2.9 million after selling 511,630 shares at the end of the third quarter.

The second-largest US public pension fund by assets has trimmed its exposure to Warren Buffett but raised stakes in volatile marijuana and meme stocks, its filings with the SEC showed on Wednesday.

The California State Teachers’ Retirement System, also called Calstrs, has raised its stakes in firms like the movie-theatre chain AMC Entertainment Holdings (AMC), cannabis manufacturer Tilray Inc (TLRY) and data analytics-software firm Snowflake (SNOW ), its filings revealed.

However, Calstrs has reduced its holdings in Berkshire Hathaway (BRK).

The pension had US$321.9 billion in assets as of Oct 31​, 2021, it disclosed to the US market regulator, the Securities Exchange Commission or SEC.

According to the documents, Calstrs purchased 133,512 more shares of AMC Entertainment to wrap up the third quarter with 689,917 shares. The AMC stock jumped nearly 19-fold in the first nine months of 2021. By contrast, the S&P 500 index rose 15% in the same period.

The AMC stock gained massive traction after it caught the attention of traders active on social media forums like Reddit. Its shares skyrocketed in a meme-stock frenzy early this year.

Additionally, Calstrs bought 347,900 shares of Tilray in Q3. It didn’t have any Trilby stocks at the end of the second quarter. The cannabis stock jumped 37% in the first nine months of the year. The marijuana producer had reported significant losses in the first quarter of fiscal 2021.

The recent proposal of the Biden administration to remove marijuana from the federal list of banned drugs has lifted the spirit of the US pot industry.

The pension fund has also purchased additional shares of Snowflake. Its stock rose 7.5% in the first nine months of 2021. It has been witnessing strong traction lately despite a mixed second-quarter result. Snowflake was expected to report its Q3 results in the after-hours on Dec 1.

Calstrs acquired additional 119,934 shares of Snowflake at the end of Q3. It had a total of 328,801 Snowflake shares at the end of the quarter.

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Calstrs trims exposure to Warren Buffet

Calstrs’ total class B shares of Buffet’s firm stood at 2.9 million after selling 511,630 shares at the end of the third quarter. The Berkshire Hathaway shares rose 18% in the first nine months of 2021. It gained 3.7% in the fourth quarter so far. In addition, Berkshire revealed that it had a staggering US$149 billion in cash at the end of September.