I have written about the benefits of boring businesses in previous posts. I thought Buffett summarized some of the arguments quite well in his latest letter to shareholders:
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Benjamin Graham is known as the father of value investing and is probably one of the most well read and studied investor of the 20th century. While his most famous work The Intelligent Investor is read in business schools around the word, not much is known about the man behind the writing. Much of this is due to the quite reserved life that Graham lead and some also to the fact that he existed before the era of the celebrity investor to understand any author’s great works requires some back ground so I present to you these 5 facts about Benjamin Graham:
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Executive Compensation is a touchy subject. Some believe executives should be compensated in relation to share price. Others feel that an executive should derive their satisfaction from the growth of their business and not from pulling down a massive salary. Buffett for one is a huge proponent of this approach. He pays himself a comparably paltry $100K salary per year and several of the businesses owned by Berkshire have CEOs who share this same compensation package.
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Don’t get me wrong I am a huge fan of Warren Buffett and both his personal and Berkshire Hathaway investing track records speak for themselves as one of the most solid and consistent in recent investing history. I can’t help but wonder though if Buffett’s rising celebrity status doesn’t have a negative effect for true long term Berkshire Hathaway investors. Hardly a day goes by without some sighting, comment, or mention of Buffett in the news. Over the past year I have seen:
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Benjamin Graham often wrote of distinguishing the difference between investing and speculating. Fannie Mae, in its current state, sits in the speculating bucket. Investing has to fun though, sometimes it is interesting to window shop, so lets look.
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For part 3 of our series on Buffett’s investment filters it is time to look at “able and trustworthy managers”. There are two components to able and trustworthy managers, lets examine each individually.
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In a previous post we discussed the Four filters of Invention of Warren Buffet and Charlie Munger by Bud Labitan. I felt that some of the material needed a more thorough description than I could provide in my overview so I would like to look exclusively at the first of the four filters, namely finding understandable companies and contribute some of my own thoughts.
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As investors we are well advised to study the styles of those that are successful at our craft in the hopes that we may emulate them. Two of the most studied characters of recent memory are Warren Buffett and Charlie Munger. With their unparalleled returns the two have achieved almost pop culture celebrity status.
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This article originally appeared on The Div-Net Feb8 2009
Much has been written about the success of Warren Buffett and Berkshire Hathaway, but little on his failures. I think a great deal can be learned by analyzing the failures of successful people. By studying these failures hopefully we can avoid them ourselves.
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I enjoyed this so much I thought I would share it. Clipped from a Fortune Magazine Blog earlier:
Warren Buffett emailed this note to the directors of his company, Berkshire Hathaway (BRK.B), Tuesday after he heard that the U.S. Treasury sold $32 billion in 4-week bills at a yield of 0%:
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“Wide diversification is only required when investors do not understand what they are doing.”
Warren Buffett
Questrade
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