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Despite Warren Buffet's quote, what he actually does with his investments is nothing at all like stock picking -- he acquires substantial fractions of companies
by bcoates 13y ago
Despite Warren Buffet's quote, what he actually does with his investments is nothing at all like stock picking -- he acquires substantial fractions of companies and then uses that control (and his personal brand) to change how those businesses and the markets they operate in run.
He's not picking companies whose values will go up, he's picking companies he can cause to increase in value by owning them. This is something non-billionaire investors can do, too, but probably not for publicly traded companies.
- mistermann 13y agoThis doesn't sound anything like my understanding of Warren Buffett, this sounds more like Carl Icahn.
- natex 13y agoYou've described the opposite of what he does. It is widely known that Buffett does not interfere with a newly acquired company's strategy, management, or overall market. His bets are sure bets currently -- as they are.
- 3am 13y agoHe wasn't talking about their management processes, he was talking about their capital structure. And he was right. A lot of the acquired companies have high ROIC, because Berkshire Hathaway at its core is a big insurance company and Buffett's investing is there to increase the book value by investing the float.