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Warren Buffett on Value Investment

Warren Buffett: Value Investor and The Oracle of Omaha

Warren Buffett, the Sage of Omaha, is famous for his ideas on value Investment in the stock market. At present, in the United States, he is one of the most respected and successful investor in the field of stock market.

Without companies and enough money, Buffett earned his own money when he was young and invested them in the stock market, which finally helped him to win a lot of money. Due to his successful stories in the field of investment, he has been called "The Oracle of Omaha" for his impressive investing strategies and ideas.


Warren Buffett: the Third Richest Person in the World

In September 2007, Forbes tells us that he was the third richest person in the world. When Buffett was young and went to the Columbia University, he studied under the legendary Benjamin Graham, an insightful value investor, who helped Buffett to insist on the principles of value investment in the 1930s. In Buffett’s all life, Graham played a very important role for constructing his own investment philosophy.

Chairman of the Berkshire Hathaway Company

When Buffett purchased the miraculous Berkshire Hathaway and became its Chairman, he helped this company to go out of its business trap and became an excellent textile company, which has a market cap in excess of $200 billion. Under the leadership of Buffett, Berkshire shares grew at an average of 21% annually, which was a great surprise in the American industrial market.

Warren Buffett’s Investing Philosophy:
When Buffett was an undergraduate student at Columbia University, he learned the investment philosophy of Benjamin Graham, which helped him to construct his own investment philosophy. Does Warren Buffett really have his own philosophy? Yes, it is true.

In order to help you understand it, let’s take a look at Warren Buffett’s value investing strategy, which, I think, is greatly illuminated by Benjamin Graham's investment strategies.

Like Benjamin Graham, Buffett also advocates investors should be  disciplined and patient. Unlike other investing institutes and companies, Buffett always seeks to find good stock quote and tries his best to buy stock shares at a low price. Once he bought them, he will keep them for a long time. Until the stock surpassed its intrinsic value, then he will sell it at a high price.

When people make their own investments in the stock market, Buffett always reminds his investors that they should understand the true meaning of intrinsic value and insists on a margin of safety. Otherwise, your investment will be risky.

To sum up, Warren Buffett’s investment philosophy must satisfy with these requirements:

If you are going to make investment in the stock market, your investment business must
(a) that we can understand;
(b) with favorable long-term prospects;
(c) operated by honest and competent people;
(d) available at a very attractive price."

These principles are easy to understand, but it is always not easy for people to enforce them when they make investments. And that’s the reason why Warren Buffett becomes one of the most richest man in the world, while other could not.

Warren Buffett Earned $1.5bn in Investing Goldman Sach


In September 2008, just days after Lehman Brothers declared bankruptcy, Americans were anxious about the future of the American economy, Warren Buffett made his company’s investment in Goldman Sach. Finally it proves that Buffett’s investment is very successful.

At present, Goldman Sach is not collapsed, but is still in good condition. Till now, Berkshire Hathaway has already received $1bn in annual dividend payments from it. Experts assume that Berkshire Hathaway is going to have more dividend payments in the future. But in just 2 years, Goldman investment helps Buffett earned $1.5 bn, which is a great surprise to most of Americans.


In order to know how Warren Buffett is successful in investing, let us take a look at the performance of Berkshire Hathaway book value in the past 30 years.


Generally speaking, in 30 years, your return is 25059 times, your excess gain is 22712.3%. perhaps you can not believe that you are going to have so much return. But the facts tell you that you can get so much, what you should do is just follow the investment philosophy of Warren Buffett.