• Home
  • December 6, 2014

Archives for December 6, 2014

Investment criteria

Warren Buffett’s investment choice: productive assets

December 6, 2014

In his Feb 25, 2012, letter to Berkshire Hathaway shareholders for FY2011, Warren Buffett listed three categories of investments under the headline of “The Basic Choices for Investors and the One We Strongly Prefer”: (i) Investments that are denominated in a given currency, including money-market funds, bonds, mortgages, bank deposits, and other instruments. (ii) Investments…

Read More about Warren Buffett’s investment choice: productive assets

Berkshire Hathaway

Berkshire Hathaway repurchase program

In a September 26, 2011, news release, Berkshire Hathaway announced, to the surprise of many, a program to repurchase Class A and Class B shares of Berkshire. Here is an insight into Warren Buffett’s thinking about share repurchase. In his annual letter (March 1, 2000) to Berkshire Hathaway shareholders for Year 1999, he said, among…

Read More about Berkshire Hathaway repurchase program

Berkshire Hathaway

Why Warren Buffett wants IBM shares to languish…

Berkshire Hathaway’s common stock investments include IBM or International Business Machines Corp. Based on Warren Buffett’s annual letter to shareholders dated February 25, 2012, for FY2011, Berkshire Hathaway has a stake of 5.5% in IBM. Given this 5.5% IBM stake, why did Warren Buffett said this in his annual letter: “We should wish for IBM’s…

Read More about Why Warren Buffett wants IBM shares to languish…

Berkshire Hathaway

Warren Buffett invests in IBM

In 2011, in what appeared to be another sign of Warren Buffett triggering his elephant gun, reports said the Berkshire Hathaway chairman had invested over US$10 billion in IBM. A Reuters report (Nov 24, 2011) headlined “Buffett sheds tech aversion with big IBM investment” said: “Warren Buffett has always made his distaste for technology investments…

Read More about Warren Buffett invests in IBM

Berkshire Hathaway

Berkshire Hathaway’s Big Four marketable securities

Warren Buffett’s views on Berkshire Hathaway’s Big Four marketable securities can be seen in his annual letter (dated February 25, 2012 for FY2011) to Berkshire Hathaway shareholders: “…we now have large ownership interests in four exceptional companies: 13.0% of American Express, 8.8% of Coca-Cola, 5.5% of IBM and 7.6% of Wells Fargo. (We also, of…

Read More about Berkshire Hathaway’s Big Four marketable securities

Succession planning

Warren Buffett on succession planning

Berkshire Hathaway’s highlights on the company’s 2011 progress is headed by the item on succession planning. In his letter dated 25 February 2012 for FY2011, Warren Buffett said: “The primary job of a Board of Directors is to see that the right people are running the business and to be sure that the next generation…

Read More about Warren Buffett on succession planning

Investment philosophy

Don’t look at the ticker

This paragraph  in “How Buffett Does It” by James Pardoe is worth noting: “Warren Buffett, the classic value investor, simply does not care what happens to price deviations in the short run. If one owns shares in great businesses, then the short term doesn’t matter, and the long term will take care of itself. The…

Read More about Don’t look at the ticker

Management

Book value as proxy for intrinsic value

In his annual letter (February 26, 2011) to Berkshire Hathaway shareholders for Year 2010, chairman Warren Buffett shared his and Charlie Munger’s thoughts on intrinsic value as a measurement of performance: “Charlie and I believe that those entrusted with handling the funds of others should establish performance goals at the onset of their stewardship. Lacking…

Read More about Book value as proxy for intrinsic value

Management

Warren Buffett on partnership

When it comes to owning shares in Berkshire Hathaway, Warren Buffett’s hope, as spelt out in one of Berkshire Hathaway’s business-related principles in its owner’s manual, is that “you do not think of yourself as merely owning a piece of paper whose price wiggles around daily and that is a candidate for sale when some…

Read More about Warren Buffett on partnership