The Essential Buffett: Timeless Principles for the New Economy

by Hagstrom, Robert G.

• ISBN13: 9780471389798
• ISBN10: 047138979X
• Edition: 1st
• Format: Hardcover
• Copyright: 2001-03-01
• Publisher: John Wiley & Sons Inc

Summary

Applying Buffett2s principles to technology and international investing From the bestselling author of The Warren Buffett Way and The Warren Buffett Portfolio comes The Essential Buffett: Timeless Principles for the New Economy. In this fresh take on Buffett2s irrefutable investment methods, Robert Hagstrom shows readers how to apply Buffett2s principles to technology and international investing using real-life case studies of successful fund managers like Legg Mason2s Bill Miller. Following the Buffett model, Hagstrom explains Buffett2s four timeless principles: 1) analyze a stock as a business; 2) demand a margin of safety for each purchase; 3) manage a focus portfolio; 4) protect yourself from the speculative and emotional forces of the market. Then Hagstrom shows how Buffett2s thinking can be applied in the new economy, addressing technology investing, international investing, small cap stocks, and socially responsible investing. Perhaps most valuable are Hagstrom2s insights into the psychology behind Buffett2s focus investing. For the first time, we are given sure-fire guidelines on how to become a winning Buffett disciple. The Essential Buffett will include convenient sidebars featuring key Buffett ideas, enabling readers to quickly compare Buffett2s fundamental tenets.

Author Biography

Robert G. Hagstrom is Senior Vice President of Legg Mason Funds Management and Director of Legg Mason Focus Capital.

Table of Contents

The Unreasonable Man	1	(22)
Lesson 1	4	(3)
Lesson 2	7	(3)
A Better Yardstick	10	(3)
Lesson 3	13	(2)
The Search for Patterns	15	(2)
Why Has Wall Street Ignored Warren Buffett?	17	(1)
A Different Way of Thinking	18	(5)
The World's Greatest Investor	23	(24)
Investment Beginnings	24	(1)
The Buffett Partnership, Ltd.	25	(1)
The Early Days of Berkshire Hathaway	26	(1)
The Insurance Business	27	(6)
A Mosaic of Other Businesses	33	(8)
The Man and His Company	41	(6)
Lessons From the Three Wise Men of Finance	47	(30)
Benjamin Graham	48	(13)
Philip Fisher	61	(7)
Charlie Munger	68	(3)
A Blending of Influences	71	(6)
Guidelines for Buying a Business: Twelve Immutable Tenets	77	(46)
Business Tenets	80	(4)
Management Tenets	84	(10)
Financial Tenets	94	(7)
Market Tenets	101	(5)
The Coca-Cola Company	106	(15)
The Intelligent Investor	121	(2)
Focus Investing: Theory and Mechanics	123	(38)
Focus Investing: The Big Picture	127	(5)
Do the Math	132	(16)
Modern Portiolio Theory	148	(13)
Managing Your Portfolio: the Challenge of Focus Investing	161	(36)
John Maynard Keynes	163	(3)
Charles Munger Partnership	166	(2)
Sequoia Fund	168	(3)
Lou Simpson	171	(3)
Three Thousand Focus Investors	174	(3)
A Better Way to Measure Performance	177	(12)
Two Good Reasons to Move Like a Sloth	189	(5)
Fair Warning Label	194	(3)
The Emotional Side of Money	197	(20)
The Temperament of a True Investor	198	(19)
New Opportunities, Timeless Principles	217	(36)
Beyond Buffett	218	(2)
Technology Stocks	220	(13)
Smaller and Mid-Capitalization Stocks	233	(7)
International Stocks	240	(10)
Learning from the Best	250	(3)
Notes	253	(14)
Acknowledgments	267	(4)
Index	271