Jeremy Miller is a research analyst at a large New York-based asset manager. He is the author of Warren Buffett’s Ground Rules: Words of Wisdom from the Partnership Letters of the World’s Greatest Investor.
Jeremy Miller – Warren Buffett’s Ground Rules
Was Ben Graham's big purchase of GEICO shares actually a value investment? Perhaps it was contrary to what many believe. "In 1948, we made our GEICO investment and from then on, we seemed to be very brilliant people." -- Benjamin Graham, 1976 Both Benjamin Graham and Warren Buffett can attribute a large part of their Read More
Five Good Questions:
- Having thoroughly read the partnership letters and presumably followed Buffett closely after that period, what percent of Buffett’s current wisdom would you guess he had by 1970 when he closed the partnerships?
- Who was Harry Bottle, and why was he so critical to the decentralized model of what Berkshire has become?
- Everyone remembers American Express as a formative investment for Buffett because he moved from purely quantitative to more qualitative, but a strong argument could be made that his Dempster investment was also highly formative. What did he learn from that experience?
- Buffett has famously said that he believes he could still do 50% per year on a small portfolio. Do you agree or disagree with his claim?
- What’s the difference between conservative and conventional?
Warren Buffett’s Ground Rules – Description
Using the letters Warren Buffett wrote to his partners between 1956 and 1970, a veteran financial advisor presents the renowned guru’s “ground rules” for investing—guidelines that remain startlingly relevant today.
In the fourteen years between his time in New York with value-investing guru Benjamin Graham and his start as chairman of Berkshire Hathaway, Warren Buffett managed Buffett Partnership Limited, his first professional investing partnership. Over the course of that time—a period in which he experienced an unprecedented record of success—Buffett wrote semiannual letters to his small but growing group of partners, sharing his thoughts, approaches, and reflections.
Compiled for the first time and with Buffett’s permission, the letters spotlight his contrarian diversification strategy, his almost religious celebration of compounding interest, his preference for conservative rather than conventional decision making, and his goal and tactics for bettering market results by at least 10% annually. Demonstrating Buffett’s intellectual rigor, they provide a framework to the craft of investing that had not existed before: Buffett built upon the quantitative contributions made by his famous teacher, Benjamin Graham, demonstrating how they could be applied and improved.
Jeremy Miller reveals how these letters offer us a rare look into Buffett’s mind and offer accessible lessons in control and discipline—effective in bull and bear markets alike, and in all types of investing climates—that are the bedrock of his success. Warren Buffett’s Ground Rules paints a portrait of the sage as a young investor during a time when he developed the long-term value-oriented strategy that helped him build the foundation of his wealth—rules for success every investor needs today.
Jeremy’s Book Recommendation: