WARREN BUFFETWARREN BUFFETGroup MemberGroup Member

Richa SaxenaRicha Saxena

Shivani MishraShivani Mishra

Famous for :Famous for :

The successful Berkshire Hathaway Company, The successful Berkshire Hathaway Company, being one of the richest men in the world, and being one of the richest men in the world, and for being a generous philanthropist.for being a generous philanthropist.

Buffet details :Buffet details :

Born - August 30, 1930 Omaha, Nebraska, Born - August 30, 1930 Omaha, Nebraska, USAUSA / Lives - United States of America –  / Lives - United States of America – OmahaOmaha

Buffett's father, Howard was a stockbroker and also became a member of congress.Buffett's father, Howard was a stockbroker and also became a member of congress. Warren Buffett showed early signs of being entrepreneurial through being involved in Warren Buffett showed early signs of being entrepreneurial through being involved in

various business dealings as a child, including purchasing bottles of cola cheaply and various business dealings as a child, including purchasing bottles of cola cheaply and selling them for a profit. He also made his first investment in the stock market when selling them for a profit. He also made his first investment in the stock market when he was just 11 years old.he was just 11 years old.

Buffett began studying at the Wharton School of Finance at the University of Buffett began studying at the Wharton School of Finance at the University of Pennsylvania, but transferred to the University of Nebraska where he graduated. He Pennsylvania, but transferred to the University of Nebraska where he graduated. He then went on to the Columbia University to do a Masters in economics. then went on to the Columbia University to do a Masters in economics.

The mentor of warren buffet was Ben GrahamThe mentor of warren buffet was Ben Graham

Buffet’s GenerosityBuffet’s Generosity

Warren Buffet Gives Away his Billions to the Warren Buffet Gives Away his Billions to the Bill & Melinda Gates FoundationBill & Melinda Gates Foundation

His largest charitable donation was to be upon His largest charitable donation was to be upon his death when he had planned to give 99% of his death when he had planned to give 99% of his massive fortune to the foundation.his massive fortune to the foundation.

Warren Buffett’s Investing Warren Buffett’s Investing QuestionsQuestions

Before Warren Buffett invests a dime, he asks:Before Warren Buffett invests a dime, he asks: Is the company in an industry with good economics? That is, is it not in an industry competing Is the company in an industry with good economics? That is, is it not in an industry competing

on price?   on price?    Does the company have a consumer monopoly or brand name that commands loyalty?   Does the company have a consumer monopoly or brand name that commands loyalty?    Can anyone with an abundance of resources compete successfully with the company?   Can anyone with an abundance of resources compete successfully with the company?    Are the earnings on an upward trend with good and consistent profit margins?   Are the earnings on an upward trend with good and consistent profit margins?    Is the debt-to-equity ratio low, or is the earnings-to-debt ratio high? Can the company repay Is the debt-to-equity ratio low, or is the earnings-to-debt ratio high? Can the company repay

debt even in years when earnings are lower than average?   debt even in years when earnings are lower than average?    Does the company have high and consistent returns on invested capital?   Does the company have high and consistent returns on invested capital?    Does the company retain earnings for growth?   Does the company retain earnings for growth?    Does the business have high maintenance cost of operations, high capital expenditure or Does the business have high maintenance cost of operations, high capital expenditure or

investment cash outflow? (If so, that’s not good.)   investment cash outflow? (If so, that’s not good.)    Does the company reinvest earnings in good business opportunities? Does management have a Does the company reinvest earnings in good business opportunities? Does management have a

good track record of profiting from these investments?   good track record of profiting from these investments?    Is the company free to adjust prices for inflation?Is the company free to adjust prices for inflation? In short, he makes companies jump through a lot of hoops before he considers putting them in In short, he makes companies jump through a lot of hoops before he considers putting them in

his portfolio.his portfolio.

Warren Buffett’s Investment Warren Buffett’s Investment Strategy & The Economic Strategy & The Economic

DownturnDownturn First, he knows that nobody can accurately or consistently First, he knows that nobody can accurately or consistently

predict something as big, diverse and dynamic as the global predict something as big, diverse and dynamic as the global economy.   economy.   

Secondly, he knows that even if you somehow knew what was Secondly, he knows that even if you somehow knew what was going to happen in the economy, you still wouldn’t necessarily going to happen in the economy, you still wouldn’t necessarily know what is about to happen in the stock market. Perversely, know what is about to happen in the stock market. Perversely, stocks sometimes fall during good times. They often rally stocks sometimes fall during good times. They often rally during bad times.   during bad times.   

Thirdly, Buffett knows that the stock market is a discounting Thirdly, Buffett knows that the stock market is a discounting mechanism. It takes the news and reflects it into stock prices mechanism. It takes the news and reflects it into stock prices immediately. Who in their right mind would sell their stocks immediately. Who in their right mind would sell their stocks today because he realizes the economy is slowing down? today because he realizes the economy is slowing down? We’ve known that for months now.We’ve known that for months now.

Warren Buffet's Six Investment Warren Buffet's Six Investment PrinciplesPrinciples

Has the company's performance been consistently good?Has the company's performance been consistently good? Does the company carry too much debt compared to its peers?Does the company carry too much debt compared to its peers? Are profit margins high compared to its peers? Are they Are profit margins high compared to its peers? Are they

increasing?increasing? How long has the company been public?How long has the company been public? Are the company's products vulnerable to "commodity Are the company's products vulnerable to "commodity

pricing"?pricing"? And finally, is the company cheap on a valuation level?And finally, is the company cheap on a valuation level?

Some Very Interesting Aspects Of Some Very Interesting Aspects Of His LifeHis Life

1.1. He bought his first share at age 11 and he now regrets that He bought his first share at age 11 and he now regrets that he started too late! he started too late!

Things were very cheap that time Things were very cheap that time

Encourage your children to investEncourage your children to invest

2.2. He bought a small farm at age 14 with savings from He bought a small farm at age 14 with savings from delivering newspapers. delivering newspapers.

One could have bought many things with little One could have bought many things with little savingssavings

Encourage your children to start some kind of businessEncourage your children to start some kind of business

3.3. He still lives in the same small 3-bedroom house in mid-town He still lives in the same small 3-bedroom house in mid-town

Omaha , that he bought after he got married 50 years ago. He Omaha , that he bought after he got married 50 years ago. He

says that he has everything he needs in that house. His house says that he has everything he needs in that house. His house

does not have a wall or a fence.does not have a wall or a fence.

Don't buy more than what you "really need" and Don't buy more than what you "really need" and encourage your children to do and think the encourage your children to do and think the

samesame

4.4. He drives his own car everywhere and does not have a driver He drives his own car everywhere and does not have a driver

or security people around him.or security people around him.

You are what you areYou are what you are

5.5. He never travels by private jet, although he owns the world's He never travels by private jet, although he owns the world's

largest private jet company.largest private jet company.

Always think how you can accomplish things economicallyAlways think how you can accomplish things economically

6.6. His company, Berkshire Hathaway, owns 63 companies. He His company, Berkshire Hathaway, owns 63 companies. He

writes only one letter each year to the CEOs of these writes only one letter each year to the CEOs of these

companies, giving them goals for the year. He never holds companies, giving them goals for the year. He never holds

meetings or calls them on a regular basis. meetings or calls them on a regular basis.

Assign the right people to the right jobsAssign the right people to the right jobs

7.7. He has given his CEO's only two rules. He has given his CEO's only two rules.

Rule number 1Rule number 1: do not lose any of your share : do not lose any of your share

holder's money. holder's money.

Rule number 2Rule number 2: Do not forget rule number 1. : Do not forget rule number 1.

Set goals and make sure people focus on themSet goals and make sure people focus on them

8.8. He does not socialize with the high society He does not socialize with the high society crowd. His past time after he gets home is to crowd. His past time after he gets home is to make himself some pop corn and watch make himself some pop corn and watch Television.Television.

Don't try to show off, just be your self and do what Don't try to show off, just be your self and do what you enjoy doingyou enjoy doing

9.9. Warren Buffet does not carry a cell phone, nor Warren Buffet does not carry a cell phone, nor

has a computer on his desk.has a computer on his desk.

Bill Gates, the world's richest man met him for the Bill Gates, the world's richest man met him for the first time only 5 years ago. Bill Gates did not think he first time only 5 years ago. Bill Gates did not think he had anything in common with Warren Buffet. So he had anything in common with Warren Buffet. So he had scheduled his meeting only for half hour. But had scheduled his meeting only for half hour. But when Gates met him, the meeting lasted for ten hours when Gates met him, the meeting lasted for ten hours and Bill Gates became a devotee of Warren Buffet.and Bill Gates became a devotee of Warren Buffet.

His advice to young people: His advice to young people:

"Stay away from credit cards (bank loans) and invest in "Stay away from credit cards (bank loans) and invest in

yourself and Remember:yourself and Remember:

A.A. Money doesn't create man but it is the man who created Money doesn't create man but it is the man who created

money. money.

B.B. Live your life as simple as you are. Live your life as simple as you are.

C.C. Don't do what others say, just listen them, but do what Don't do what others say, just listen them, but do what

you feel good. you feel good.

D.D. Don't go on brand name; just wear those things in Don't go on brand name; just wear those things in

which you feel comfortable. which you feel comfortable.

E.E. Don't waste your money on unnecessary things; Don't waste your money on unnecessary things;

just spend on them who really in need rather. just spend on them who really in need rather.

F.F. After all it's your life then why give chance to After all it's your life then why give chance to

others to rule our life." others to rule our life."

  Warren Buffett QuotesWarren Buffett Quotes Wide diversification is only required when investors do not understand what they Wide diversification is only required when investors do not understand what they

are doing.are doing.  Stock Market -  - Investing -  - Knowledge

Only buy something that you'd be perfectly happy to hold if the market shut down Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years.for 10 years.  Stock Market -  - Long Term Investing  

We simply attempt to be fearful when others are greedy and to be greedy only We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.when others are fearful.Greed -  - FearFear -  - InvestingInvesting

Why not invest your assets in the companies you really like? Why not invest your assets in the companies you really like? As Mae West said, "Too much of a good thing can be As Mae West said, "Too much of a good thing can be wonderful".wonderful".  InvestingInvesting -  - AssetsAssets

Your premium brand had better be delivering something Your premium brand had better be delivering something special, or it's not going to get the business.special, or it's not going to get the business.  BrandingBranding  

Our favorite holding period is forever.Our favorite holding period is forever.  Long Term InvestingLong Term Investing