Saturday, December 10, 2011

Warren Buffett's Three Investment Styles


According to can turtles fly blog: “My view is that Warren Buffett went through three different phases, with each consisting of different investment techniques. The overall investment theory remained the same—what people call value investing—but his execution, tactics, and strategy differs across the three phases. Some people may break up his career into additional periods but my feeling is that the three I will describe essentially captures the styles….

Phase I: Classic Value Investor. In percentage terms (and hence, in terms of "skill"), Warren Buffett had his strongest return during his early days when he ran a hedge fund. He posted 13 years in a row with no loss and significant outperformance during the 1950's and 1960's…

Phase II: Buffett Prime. I have to do some research to pin down the exact years but, roughly speaking, the second phase of Buffett's career spanned the 1970's, up to early 1990's. This is the phase I call Buffett Prime. Although Warren Buffett had stronger percentage returns in phase I, I would say he created way more wealth in dollar terms, during phase II. The first phase made Warren Buffett a millionaire but the Buffett Prime stage is what put Buffett on the map. This is the phase when Warren Buffett bought large, dominant, companies like Washington Post, American Express, and Geico……

Read about the rest at http://can-turtles-fly.blogspot.com/2011/12/warren-buffetts-evolution-and-his-three.html

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