Jim Rohn famously said,

You are the average of the five people you spend the most time with

As a young investor starting out it would serve you well if you can spent time with Warren Buffet (vicariously) by reading his fantastic letters

At Tankrich – We have taken an initiative to share his learnings through our video channel

This week having finished the partnership letters I thought it would be good if I could document those learnings in a single place

After few weeks of editing here is the final copy for you on Learnings from Warren buffett partnership letters

Below is Table of content of this ebook


Download a copy by sharing any of the above social links (I do this so that this reaches maximum people through your social networks)

If you are reading this in your inbox go to this link to download a copy

Building blocks

  1. What should be focus of long term investor
  2. Surest means of profit is value investing
  3. Think long term to evaluate performance
  4. Beating index is very tough
  5. True conservatism
  6. Magic of Compounding
  7. Price is everything aka Margin of Safety
  8. Cigar butt as a group works out to be a good investment
  9. Evaluate money manager even if it’s you
  10. Public opinion is not a substitute for though
  11. Investing edge
  12. Role of luck in Investing

Types of Investment

  1. What is a work-out Investment ?
  2. What are Generals ?

Security’s price movements

  1. No movement is best for long term investors
  2. Dividend and impact on price of securities
  3. Illiquidity and prices
  4. Playing volatility is a loser’s game
  5. Past price behaviour is of no relevance
  6. In short term demand and supply drive prices, In long term earnings power

Asset Allocation

  1. Asymmetric allocation
  2. Use mathematical expectation and it’s wideness to allocation

Qualities to look for in business

  1. Monopoly, recession proof

What works in Investing

  1. Buy the right Company
  2. Buy the right Price

Moat building activities

  1. Expenditure on sales and promotion

When to Sell

  1. When a security reaches Fair Value
  2. Sell when valuations catch up

Use of Leverage

  1. Utilise leverage in portfolio

Valuations

  1. What is not value
  2. Book value a better measure than next year PE
  3. Buy out of favour stock at bargain price to a private owner
  4. What drives value – assets, Earnings power and industry conditions
  5. Selling below Value to a Private owner

Management is key to investing

  1. Management is important in spite of good numbers

How a business turnarounds

  1. Reduce Inventory
  2. Free up Capital, reduce working capital and capex
  3. Cut overhead
  4. Closed inappropriate franchise
  5. Improve Earnings power

Diversification

  1. Bet hard when things are in your favour
  2. Consequences of wide diversification

Why Typical money managers fail

What businesses to avoid

  1. Business dependent on trickle of ideas
  2. Business with a human issue

Book Recommendations

The depth of coverage itself indicates that these letters are a must read for any serious investor

In case you are facing issue in download tweet me