Introduction
1.
A Master Investor
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“I’ll Take the Money”
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Starting Early
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Influences: 85 Percent Ben Graham
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Influences: 15 Percent Phil Fisher
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“Commodity” and “Franchise”
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The Advertising Oligopoly and Other Favorites
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GEICO
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Buffett’s Big Idea
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The Other Graham
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A College Goes into the Television Business
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Buffett’s Great Throw of the Dice
2.
Some Favorite Investing Principles
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Good Businesses
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Bad Businesses
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The Market and Fair Value
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Disasters
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Nothing Exceeds Like Success
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Pricing the Whole House
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The Part is Better Than the Whole
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Risk and Reward
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The Margin of Safety
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Zigging When You Ought to Zag
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The Efficient Market Hypothesis
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What a Good Boy Am I
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Beta
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The Out of My League Dilemma
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The Leverage in Insurance Companies
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The Cash Magnification Effect
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The 12 Percent Equity Bond
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Goodwill — the Gift That Keeps Giving
3.
Buffett’s Methods
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Keep It Simple
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Networking
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Gold is Where You Find It
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Res Ipsa Loquitur
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Corporate Stock Repurchase Programs
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Special Distributions
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Stock Options
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Corporate Philanthropy
4.
How to Invest Like Buffett
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Understand the Figures
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Apply Your Own Business Experience
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Go and Look
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Venture Capital
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Know the Values
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Reverse Engineering
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The Secret: Steady Compounding
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Avoid Risk
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What It Takes to Be a Good Investor
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What Makes a Bad Investor
Conclusion
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How applicable is Buffett’s method today?
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What, then, should the prudent investor do now?
Appendix
I: Some of Berkshire Hathaway’s Principal Equity Transactions
(1964-1986)
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American Express
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Affiliated Publications
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Interpublic Group of Companies
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Ogilvy & Mather International
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Washington Post Company
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GEICO Corporation
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American Broadcasting Co.
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SAFECO Corp.
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Amerada Hess
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Handy & Harman
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Media General
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Times Mirror Co.
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General Foods
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Pinkerton’s, Inc.
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RCA Corp.
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Time, Inc.
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R. J. Reynolds
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The Scott & Fetzer Company
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Capital Cities Communications
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Fireman’s Fund Corporation
Appendix
II: Berkshire Hathaway’s Principal Year’s End Holdings (1976-1986)
Appendix
III: Buffett’s Epistles: Extracts from
Berkshire Hathaway’s Annual Reports
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The Banking Business
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The Insurance Business
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The Textile Business
Appendix
IV: Principal Equity Holdings of the Sequoia Fund (30 June 1986)
Appendix
V: Principal Equity Holdings of Grinnell
College Endowment Fund
Appendix
VI: Principal Equity Holdings of Tukman
Capital Management
Appendix
VII: A Warren Buffett Bibliography
Notes
Index