Warren Buffett On The Similarities Of Underwriting And Investing

0
Warren Buffett On The Similarities Of Underwriting And Investing
By Mark Hirschey (Work of Mark Hirschey) [<a href="http://creativecommons.org/licenses/by-sa/2.0">CC BY-SA 2.0</a>], <a href="https://commons.wikimedia.org/wiki/File%3AWarren_Buffett_KU_Visit.jpg">via Wikimedia Commons</a>

Warren Buffett On The Similarities Of Underwriting And Investing by Greg Speicher, Ideas for Intelligent Investing

Get The Full Warren Buffett Series in PDF

Get the entire 10-part series on Warren Buffett in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues

In 1999 Warren Buffett wrote, “In Ajit, we have an underwriter equipped with the intelligence to properly rate most risks; the realism to forget about those he can’t evaluate; the courage to write huge policies when the premium is appropriate; and the discipline to reject even the smallest risk when the premium is inadequate. It is rare to find a person possessing any one of these talents. For one person to have them all is remarkable.”

It is interesting that these qualities parallel those required to be a successful investor.

A successful investor must:

Exclusive: Voss Value Launches New Long Only Special Situations Fund

Since its inception in January 2012, the long book of the Voss Value Fund, Voss Capital's flagship offering, has substantially outperformed the market. The long/short equity fund has turned every $1 invested into an estimated $13.37. Over the same time frame, every $1 invested in the S&P 500 has become $3.66. Q1 2021 hedge fund Read More


  1. properly assess the future prospects of a business;
  2. quickly pass on those businesses he cannot understand;
  3. have the courage to make a large bet when the odds are in his favor;
  4. not invest if the margin of safety is too small.

You can infer from Buffett’s comments that finding (or becoming) an investor with these traits is difficult.

No posts to display