At last, here is a book that reveals what the public really wants to know about this legendary investor: how he determines where he puts his money. From a team with privileged insight, Mary Buffett, a savvy CEO and Warren Buffett's former daughter-in-law, and David Clarke, a successful portfolio analyst, comes BUFFETTOLOGY, the most detailed explanation ever of the billionaire's unique investment techniques.
Using Warren Buffett's system to access a company's potential economic excellence and the right price to pay for its stock, BUFFETTOLOGY demonstrates the actual mathematical models and equations, revolving around three variables: the yearly per share earnings figure, its predictability, and the market price of security. With BUFFETTOLOGY, individual investors will come to truly understand, and emulate, Warren Buffett's masterful insight, and see that investment is most intelligent when it is most businesslike.
For decades, Warren Buffet has been a nearly heroic figure of finance, whose strategy turned an initial $105,000 investment into a $16-billion fortune and whose publicly traded holding company, Berkshire-Hathaway, rose from a $450-per-share price in the 1980s to $36,000 in 1997. Here, Buffet's former daughter-in-law, a CEO of Superior Assembly, with a 30-year friend of the family, who is an Omaha portfolio analyst and lawyer, tells all. Buffet scorns speculative stock-market hype. He buys--at a carefully researched favorable price--a 100% or partial interest in companies having "intrinsic value" and a logical pattern of growth as a virtual consumer monopoly based on need (e.g., GE) or common acceptance (e.g., Coca-Cola) financed tax-free by undistributed earnings. Guidance is given here on researching a company's intrinsic value and management competence, making stock-price downturns into buying opportunities, taking account of inflation taxation considerations, and the tantalizing question of when to sell. Most interesting is the authors' closing rundown of "Warren's" specific holdings and how they grew.