Customer Reviews

How Buffett Does It: 24 Simple Investing Strategies from the World's Greatest Value Investor (Mighty Managers Series)

5 star:		(5)
4 star:		(3)
3 star:		(3)
2 star:		(0)
1 star:		(2)

 

 

`How Buffett does it' is an excellent introductory book for people interested in value investing, or interested in Mr Buffett's investment methodology.

The book is written in a very easy to read, and easy to understand manner and will give you a solid foundation for building your value knowledge investing further. There are no formulae on how to calculate the true value of a share, or worked examples that will help you do this for your own selected shares, which would have been nice to see as an appendix, which was why I didn't give the book 5 stars. If you have other Buffett books in your library then this book will probably recover old ground. If you're just starting out, then I would recommend this as one of the better books with which to start your education.

Other reviews written on this book are fair, if you're looking for an in-detail how to book, then this is not your book, if you're looking for simple guidelines you can remember and apply easily this book is a worthwhile purchase.

Pardoe has written an easy-to-read book, split up into 24 short chapters. He gives us an insight into the investment method of Warren Buffett, without going into details. It seems that he really had to stretch himself to fill 24 chapters, as some thoughts are repeated in various chapters. "Don't follow the herd", "Practice independent thinking", "Buy when everybody else is selling" are covered in different chapters, although they cover the same thing. The main success factor of Warren Buffett, however, is touched upon only very briefly: Buy companies below their intrinsic value, in other words: Buy the 1-Dollar-bill for 40 cents.
What is this intrinsic value? How do you determine it? How can Buffett forecast future cash flows more accurately than all the other highly paid wall street experts? This is what the reader would like to know!
The reader is not interested in common sense statements like "Buy companies whose products are needed or desired and have no close substitute". Everybody will agree to that, but how do you find such a company before everybody else finds out, and the market cap reflects this potential?
This is a major shortcoming of this book. However, since it is an easy-to-read book, it can be viewed as a good starter for the Buffet investment method, before the reader turns to more serious books like Benjamin Graham's "The Intelligent Investor".

An excellent primer on value investing. I never thought I would enjoy a book about investing as much I did this one. James Pardoe does an excellent job when he talks about the 24 simple investing strategies that has made Warren Buffett the second richest man in the world. This is not a how to book, but there is very good information in here that will put you on the right path to value investing. We all won't become a Warren Buffett but using these strategies will make you money and you can become your own financial advisor.

Some so-called experts make the world of investing seem like rocket science and that is exactley what they want you to believe. Buffett's strategies are common sense and he has often said anyone with average intelligence can impliment them.

However, as simple as they are, to become a good value investor you must do your homework, know the business you are going to buy and have the proper temperament. Buffett does not use any computer software to analyze a business, the only thing he uses a computer for is to play Bridge online with friends and family. However, he is an avid reader and this book tells you to do the same. Buffett reads six hours a day and the rest of the time he is thinking about what he just read. Before you buy a business you must read, read and read some more.

This book is a great example of the architectural and design mantra, "form follows function." Its "form" is that of an easy-to-read handbook explaining the basics of value investing. Its "function" is to explain how Warren Buffett, a self-made investor who is now worth about $40 billion, used value investing to make his fortune. Buffett's premise is that people should base their investing strategies on common sense and search out assets that are selling for less than they are worth. For this, you don't need esoteric mathematical formulas; all you need are the guidelines that this book clearly enumerates. Although author James Pardoe often merely reiterates what Buffett has said in his own books, Pardoe deserves credit nevertheless for packing his handbook with illuminating examples and stories. We believe this book will be practical for anyone intimidated by investing, overwhelmed by data or vulnerable to pressure from brokers. In his description of value-investing, Pardoe raises a good question: Why does Wall Street dislike it so much? Buffett's answer: "It's too simple."

Warren Buffett is by far the wealthiest and most famous investor of all time. Why not learn how he achieved his success and follow his example? This is a short book, but features the most important elements of Mr. Buffett's philosophy:

* Buy businesses, not stocks
* Buy companies with competitive advantages or moats
* Practice inactivity, not hyperactivity
* Choose simple and easy to understand businesses
* View market downturns as buying opportunities (2008 and 2009 is a perfect and opportune time)
* Concentrate your investments

Other investment theories may try to persuade investors that it is impossible to beat the market because most money managers cannot. But do they ever tell investors to concentrate investments, meaning not to diversify too much? Of course not. Most money managers fail to beat the market because they own way too many investments. My favorite quote from this book on diversification is:

"If you've found the right stock, why buy only a little?"

I highly recommend this book and any other book that talks about Warren Buffett's investment style. We are fortunate enough that he is willing to share it with all of us.

-Mariusz Skonieczny, author of Why Are We So Clueless about the Stock Market? Learn how to invest your money, how to pick stocks, and how to make money in the stock market

There are dozens of books on Value investing and dozens more on Warren Buffett.
I have read many of those and some. This particular book is concise and deals with the main themes of the Buffett method of Value investing. It is clear from this book that Mr. Buffett has taken from his mentors Graham and Dodd and built upon that with the wisdom of decades of investment. The book is a must for anyone who wants to be a sensible investor, no matter what their style of investment.
A MUST READ.

The world of finance and investing strategies are complex. This primer of Warren Buffet's principles of investing is a smart approach and introduction to value investing. Each chapter introduces sound principles upon which James Pardoe, the author, elaborates in a concise format.

This book will not show you what to do or in what company to invest your money. However, this book will give you guidance on how to approach formulating your portfolio.

There are other books that further elaborate the basic principles of Warren Buffet and his mentor, Benjamin Graham.

The Warren Buffett Way, Second Edition

How to Think Like Benjamin Graham and Invest Like Warren Buffett

The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition)

VERDICT:

This book serves as a stepping stone into the world of Value Investing.

This book is worthwhile if you are looking for an introduction into basic instructions, and is similar to the genre of the Life's Little Instruction Book of the 1980s Life's Little Instruction Book: A Few More Suggestions, Observations, and Remarks on How to Live a Happy and Rewarding Life (Life's Little Instruction Books)

If you're looking for details, look elsewhere. If you want things, plain and simple on Value Investing, this is a good start.

Firs of all: this book will not make you rich. Nor will explain you a secret which will help you become rich.
After all, it was not written by Warren Buffet himself - that should give you additional warning sign.
This book explains some principles Buffet used in his way to the top, it explains differences between him and many others and many other things, but it doesn't bring any magic formula. Some things you will find in are useful, of course and in general it is worth reading, but in general nothing spectacular. It explains Buffet's general philosophy and strategy, but without some key things: how to find "gold share" and how will you know when you find it. Also, my opinion is that it's applicable to USA only, if you are in Europe - take care. Shares available in some smaller countries are not even close to ones you can buy in USA. But can still offer high revenues if you NOT follow some rules in this book.
Anyway, I would recommend this book to anyone dealing with shares because it gives you some wider perspective and ideas you will not hear from your own broker, but still - use your own head.

$1000 invested in Warren Buffett's Berkshire Hathaway stock in 1965 would be worth roughly $5 million today. This astonishing success didn't come through Buffett's use of high-tech computer trading models or intricate market timing systems.Instead, it came through his stubborn adherence to the time-honored fundamentals of value investing. This book is a step-by-step guidebook for investing like Buffett in any market environment. This value investing primer presents and expands on 24 primary ideas Buffett has followed from day one that include: maintain proper temperament; look for a company that is a franchise; don't look at the ticker; ignore the macro, concentrate on the micro; use all your horsepower; avoid the costly mistakes of others, etc. Buffett is now the richest man in the world. Drawing from Buffett's incredibly rich investment experience, this value packed guide will show you how to follow his examples to avoid diversification, instead, investing in a few enduring companies with predictable business models; beware of hidden costs, meaning everything from commissions on active stock trading to high mutual funds fee; invest in "old economy" businesses, "boring" companies that have been around for 50 years and will probably survive the next 50, and many others. Virtually every Buffett's principle came into play during the Internet stock bull market. Between mid-1998 and early -2000, as cautious veterans like Buffett were laughed at for missing the boat, Berkshire Hathaway's shares lost more than half of their values. Still, Buffett refused to buy internet stocks, quietly counseling patience, prudence and long term value. When the dust settled, Buffett was right again. This book shows you how to follow his lead and build a portfolio that is solid, easy to understand, and designed to provide you with tremendous long term returns without the short term headaches.

This short and easy-to-read book would benefit those who either (a) would like an introduction to Warren Buffett's philosophy, or (b) would like a refresher to remind them to stay focused on Buffett's investing philosophy.

The author briefly describes 24 investing strategies that reflect principles commonly attributed to Warren Buffett. There is some overlap among the strategies (like "make your own investment decisions" and "practice independent thinking"), but sometimes repetition helps to reinforce learning.

This book does not provide a lot of details to help an investor actually implement Buffett's strategies. For that, I would recommend reading books by Buffett's mentor, Benjamin Graham, like Security Analysis or The Intelligent Investor. Alternatively, Pat Dorsey's, The Five Rules for Successful Stock Investing, provides some very detailed information on how to implement strategies consistent with Warren Buffett's philosophy.