Warren Buffett’s Letter – 1991 (Part 5)
Jan 3rd, 2007 by Martin Lee
Marketable Common Stocks
The majority of Berkshire’s stock holdings remain unchanged compared to the previous year. This stay-put behavior reflects Warren Buffett’s view that the stock market serves as a relocation center at which money is moved from the active to the patient.
Because of the large sums he works with, Warren Buffett considers the “searching for the superstars” method as his only chance for real success. This method includes:
1) Searching for large businesses with understandable, enduring and mouth-watering economics.
2) Run by able and shareholder-oriented managements.
3) Buying a few of the best companies at a sensible price and holding them for the long term. He certainly would not wish to own an equal part of every business in town.
If finding great businesses and outstanding managers is so difficult, why should proven products be discarded?
His motto is: “If at first you do succeed, quit trying.”
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