Essays from warren buffett
Neither we nor most business managers would dream of feverishly trading highly- profitable subsidiaries because a small move in the Federal Re- serve's discount rate was predicted or because some Wall Street pundit had reversed his views on the market.
After completing 4 books that year, he brought the challenge back for with a new list of books. DividendsReinvestment and stuff: - Shareholders would be far better off if earnings were retained only to expand the high-return business, Thinking Long-term Buffett says to ignore political and economic forecasts, and invest for the long-term.
Focus on Value Investing: - The value of any stock, bond or business today is determined by the cash inflows and outflows-discounted at an appropriate interest rate-that can be expected to occur during the remaining life of the asset.
The essays of warren buffett summary
When investing, we view ourselves as business analysts-not as market analysts, not as macroeconomic analysts, and not even as security analysts. If we calculate the value of a common stock to be only slightly higher than its price, we're not interested in buying. It is a mistake to think that one limits one's risk by spreading too much between enterprises about which one knows little and has no reason for special confidence This principle holds that one should not make an investment in a security unless there is a sufficient basis for believing that the price being paid is substantially lower than the value being delivered. Notes: 1 hiring new management not a good value add I would say that the controlled company offers two main advantages. Notes: 1 no rush. There will always be new headlines talking about gloom and doom, but ignore them and stay the course. First, the original "bargain" price probably will not turn out to be such a steal after all. True investing is based on the relationship between price and value.Notes: 1 reputation is so valuable companies obtain the shareholder constituency that they seek and deserve. Market," an obliging fellow who shows up every day to either buy from you or sell to you, whichever you wish.
They are given a simple set of commands: to run their business as if 1 they are its sole owner, 2 it is the only asset they hold, and 3 they can never sell or merge it for a hundred years Buffett thinks most markets are not purely efficient and that equating volatility with risk is a gross distortion.