What's the difference between the A and B shares? · Transcript · BuffettMungerGPT

WarrenThe difference between the Berkshire A and B is simply that an A can be converted to a B at any time in the ratio of 1A into 30 B's. The B cannot be converted into the A, so it's a one-way street on conversion. The economic value of the B is exactly 1-30th that of the A. So at anything that, anytime the A ever gets any money of any kind from dividends or liquidation or a merger or something of the sort, for every $30 that you get on the A, you're going to get $1 on the B. The two differences are that there is less voting power proportionately in the B, and the B does not participate in a designated contributions program that Berkshire runs simply because that would be very, very hard to administer. And when we issued the B, we pointed out those two differences. The B should never sell for more than 1.30th of the price of the A. When it sells just a tiny bit above that, then arbitrage settles in as people buy the A and convert it to B and sell the B. Occasionally the B may be at a slight discount to the A. because it's not convertible the other way. But I think as a practical matter, you can treat the A and B as very equivalent investment choices. There's not enough difference to make it significant.