Value  Investments

What did Buffet  say about  value  investments ( a very short  summary)...

Value investing:  בהשקעות ערך-לא בוחרים חב' עם ביצועים מבריקים אלא חב' יציבות

Value investing is about sound investing and not about brilliant investments.

… I think sound investing can make you very wealthy if  you` re  not  in too big of a hurry. And  it never  makes you poor , which  is better

The esssence of  Buffet mathod  is: מתמקדים  ברכישת חברות מצויינות שמחירן זול

Stocks are simple. All you do is buy shares  in a great business for the less the business is intrinsically worth, with the managers of the highest integrity and ability. Then you own those shares forever. (1990).

Asset  Allocation: הקצאת נכסים פירושה שקונים רק מה שזמין(וזול-שפירושו מחיר נמוך משמעותית מהערך)

For me, it`s what`s  available at the time. We`re not interested   in categories per se. We`re   interested  in value.  

Long  term investments:בבחירת השקעות לז.א. נפעיל את  אי הוודאות  לטובתינו  

The future is never  clear ; you pay a very high  price for a cheery consensus. Uncertainty  actually  is the friend of  the buyer of  long-term values .

If   the  business does  well, the stock eventually  follows.

We like to buy businesses. We don`t like to sell, and we expect the relationships to last a lifetime.(1986).

Risk avertion: מה המשמעות של הימנעות מסיכון

I put heavy weight on certainty… if you do that, the whole idea  of  risk factor doesn`t make any sense to me. You don’t do it  where you take a significant risk. But it`s not risky to buy   securities at a fraction of what  they`re worth.

Risk comes from not knowing what you are doing.

Buffet  likes to quote  J.M.Keyens:

Don`t try and figure out what the market is doing. Figure out  a business  you understand, and concentrate.( Forbes 400, October, 1993).

What kind of managers to prefer?   מי המנהלים שאנו נעדיף? מנהלים שחושבים כמו בעלים

Managers who think like  owners :

I always picture myself as owning the whole place. And if management is following the same policy that I would follow if I owned the whole place, that is a management  I like. . (Buffet talks strategy with students, January 1994).

What  kind of  excellent  companies to buy? :   כללי אצבע למבחני איכות של חברות לצורכי השקעה

Companies with a moat:

We like great companies with dominant positions, whose francise is hard to duplicate and has tremendous staying power or some permanence in it. (Berkshire Hathaway annual meeting, May  1995)

You need a moat in business to protect you  from  the guy who is going to come along  and offer it (your product) for a penny cheaper.(”Warren Buffet Talk  Business”, The University of North Carolina, 1995).

Great business only:

Let say you were going  away  for  10 years and you wanted to make  one investment and you know everything you know now, and you  couldn`t change  it while you`re gone. What  would you think about ? (1994).

Charlie [Buffet`s partener] made me focus on the merits of a great business  with  tremendously growing earning power, but only when you can be sure of it-not like Taxas Instruments or Poloroid, where the earning power was hypothetical.( Forbes 400, October, 1993).

The definition of a great company is  one that will be great for  25 or 30 years. (Berkshire Hathaway annual meeting, 1996)