The success story behind Berkshire Hathaway’s Warren Buffett---who is also the company’s largest shareholder and CEO---spans back to his years packing groceries at his grandfather’s grocery store. Buffet showed maturity beyond his years when he decided that he would rather make money than play games with the other children his age.
Born Warren Edward Buffett on August 30, 1930 to a stockbroker-turned-Congressman, it is no wonder that Buffett showed an amazing flair for business and numbers at such an early age. At 11 years old, he jumped into the world of high finance by buying three shares of Cities Service that he later sold. He immediate regretted the decision as the numbers for Cities Service soared. Buffett learned his lessons earlier than most, paving the way for the plethora of critical real-world decisions he was going to make.
Warren Buffett was educated at Woodrow Wilson High School, Washington, D.C. after his father was elected into Congress. He received his college eduation at The Wharton School, University of Pennsylvania then later at the University of Nebraska where he received a B.S. in Economics. Choosing to further his education, Buffett enrolled at the Columbia Business School where he graduated in 1951 with an M.S. in Economics.
Warren Buffett experienced a variety of jobs before he landed himself at Berkshire Hathaway. Fresh out of school, he worked as an investment salesman at Buffett-Falk & Co., Omaha until 1954. From 1954 to 1956, Buffett served at Graham-Newman Corp., New York as a Securities Analyst. From 1956-1969, he sat as a General Partner at the Buffett Partnership, Ltd. Since 1970, Buffet has served at Berkshire Hathaway Inc., Omaha as its Chairman and CEO.
Berkshire Hathaway Inc. is a conglomerate holding company that oversees and manages a number of subsidiary companies. Since coming onboard, Buffet has been instrumental in driving the company to the colossal status it stands at today.
In 2008, Warren Buffet was ranked number one on Forbes list of World’s Billionaires making this the richest success story in the world.
Showing posts with label warren buffet. Show all posts
Showing posts with label warren buffet. Show all posts
Wednesday, August 26, 2009
Thursday, August 20, 2009
Top Ten Investment Strategies from Warren Buffett
Readers get a glimpse of how Berkshire Hathaway’s Warren Buffett generates wealth in John Train’s book “Midas Touch.” The following are the top ten investment principles used by Buffett himself.
1. Buy a share as though you were buying the whole company. Determine how an enterprise is worth but do not rely on formal financial projections or mathematical formulae. Invest in “a business you understand, favorable long-term economics, able and trustworthy management, and a sensible price tag.”
2. Volatility does not create risk. A serious investor sees opportunity in volatility.
3. Value should include “growth at a reasonable price” or GARP. The ideal companies have a business “moat” that has steady and reasonably predictable growth. In the long run, these businesses are more tax-efficient and more convenient than one bought at a bargain.
4. Invest on what you know best. Refrain from seeking the “newest” thing because it is too risky. Buffett's biggest investments are firms founded in the 1800s, such as American Express, Wells Fargo, Procter & Gamble, and Coca-Cola. Said Buffett: “Startups are not our game.”
5. Avoid investing in bad industries, or turnarounds. It is not sound to invest in a business that requires a revival.
6. Seek out businesses that can reinvest at high rates of return over long periods. Avoid investing in low-margin businesses that require cash from you periodically and can expect only modest rates of return.
7. Do not sell a great stock just because it has doubled. Its value could go up when you least expect it, sometimes going up 20 or even 100 times during the next generation.
8. Never offer your own underpriced stock for the fully valued stock of an acquisition candidate. You will end up on the losing end of the bargain.
9. Avoid long-term bonds. Given how easy it is to inflate currencies, this is not a wise move.
10. Invest like a fanatic. Concentrate relentlessly on how you can transfer wealth to your own pocket.
1. Buy a share as though you were buying the whole company. Determine how an enterprise is worth but do not rely on formal financial projections or mathematical formulae. Invest in “a business you understand, favorable long-term economics, able and trustworthy management, and a sensible price tag.”
2. Volatility does not create risk. A serious investor sees opportunity in volatility.
3. Value should include “growth at a reasonable price” or GARP. The ideal companies have a business “moat” that has steady and reasonably predictable growth. In the long run, these businesses are more tax-efficient and more convenient than one bought at a bargain.
4. Invest on what you know best. Refrain from seeking the “newest” thing because it is too risky. Buffett's biggest investments are firms founded in the 1800s, such as American Express, Wells Fargo, Procter & Gamble, and Coca-Cola. Said Buffett: “Startups are not our game.”
5. Avoid investing in bad industries, or turnarounds. It is not sound to invest in a business that requires a revival.
6. Seek out businesses that can reinvest at high rates of return over long periods. Avoid investing in low-margin businesses that require cash from you periodically and can expect only modest rates of return.
7. Do not sell a great stock just because it has doubled. Its value could go up when you least expect it, sometimes going up 20 or even 100 times during the next generation.
8. Never offer your own underpriced stock for the fully valued stock of an acquisition candidate. You will end up on the losing end of the bargain.
9. Avoid long-term bonds. Given how easy it is to inflate currencies, this is not a wise move.
10. Invest like a fanatic. Concentrate relentlessly on how you can transfer wealth to your own pocket.
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