“It's good to learn from your mistakes. It's better to learn from other people's mistakes.” - Warren Buffett
“I know I'll perform better if I rub my nose in my mistakes. This is a wonderful trick to learn.” - Charlie Munger
Your success as an investor wholly depends on your skills and discipline to adhere to them. The skills could be learned and learned fast from other people’s mistakes. And if you get the opportunity to learn from legendary investment guru Warren Buffett then nothing like it.
Buffett started his investment at the age of 11. After graduating from Columbia University and trained under Benjamin Graham who is considered in many ways as the father of value investment. Buffett did a couple of jobs and started Buffett Partnership Ltd in his own town – Omaha.
The real game of investment started when he took over Berkshire Hathaway Inc. a sick textile company in 1965, in an emotional urge. These syndromes are common in investment. Hence he started a business that was destined to fail.
The whole credit goes to his open-mindedness, and learning year by year. Many fantastic people joined him like Charlie Munger who recently died at the age of 99. They strived the journey with single-mindedness to enhance the owner’s earnings. This focus transformed Berkshire into a holding company of wonderful business and a self-sustainable engine. The core engine of Berkshire is the insurance business which generates regular premiums (‘float’) to be used by Buffett to acquire and invest in great businesses globally.
Today Berkshire e is valued at $900 billion in the stock market. This value creation benefited immensely to millions of shareholders across the globe.
However, if you look at closely Buffett’s journey from 1965 till recently in 2023 there are many mistakes and errors. These mistakes are commission as well as omission type during this period. I studied them over the period and benefited myself. So, I wanted to bring you all the same learning to help you design investment processes, manage risk, and maximize profits to build sustainable wealth.
I compiled these lessons in an upcoming book – ‘The Intelligent Investor’s Mistakes: Warren Buffett’. In this book, I discussed 38 such companies or industrious where Buffett made mistakes. I presented each company as a chapter in the book with the story of what happened, followed by quotes from Buffett and Munger himself. And end each chapter with key lessons for you to learn to become a wiser investor.
I am sure the book would benefit you as an investor as well as make your journey more joyful.
The book also exhibits various investment strategies like Scuttlebutt investment, Cigar-butt investment, Basket investment, and so forth.
The lessons are wide to learn and master your own investment game. The following are a few lessons –
1. Own biases
2. Correctly valuing a company’s future economics
3. How to identify the competitive enduring strength?
4. Market euphoria
5. Capital allocation
6. Opportunity cost
7. Mistakes of omission – “Sucking the thumb”
And many more.
These 38 stories would help you to maximize the returns. These stories are short and fun to read.
The whole book is written to evolve you into a better investor to guard against your own emotional biases and syndromes face during your journey towards a wealthy life. These valuable lessons unleash your potential and achieve your dreams.
So, stay tuned for the book release announcement soon in April 2024 to load up your investment strategy toolkit.
As a token of appreciation for reading the article, get your gift of a sample eBook copy of my new upcoming book – ‘The Intelligent Investor’s Mistakes: Warren Buffett’. Visit at: www.balajikasal.com
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