I think Warren Buffett is the greatest equity investor the world has ever known. I’m not alone in my opinion. #-ad_banner-#His investing style is rooted in the value investing teachings of his mentor Benjamin Graham. As Buffett would explain it, he just sits around and waits for fat pitches where a company is clearly worth a lot more than its stock price implies. When something is obviously mispriced (read: undervalued), Buffett buys — and he buys with conviction. It sounds simple, but it isn’t. What Buffett fails to mention is that when something is obviously cheap… Read More
I think Warren Buffett is the greatest equity investor the world has ever known. I’m not alone in my opinion. #-ad_banner-#His investing style is rooted in the value investing teachings of his mentor Benjamin Graham. As Buffett would explain it, he just sits around and waits for fat pitches where a company is clearly worth a lot more than its stock price implies. When something is obviously mispriced (read: undervalued), Buffett buys — and he buys with conviction. It sounds simple, but it isn’t. What Buffett fails to mention is that when something is obviously cheap to him, it often looks cheap for good reason to the rest of us. In fact, Buffett’s most successful investments have often been stocks that the rest of us are afraid to buy. A perfect example: One of Buffett’s greatest investments was American Express (NYSE: AXP). In retrospect, his investment in this world-class company may look like a no-brainer. But at the time, it was a complicated and nerve-racking prospect. In 1964, American Express shares dropped by 50% as the result of fears over potential liability the company had in relation to the infamous salad oil… Read More