WARREN BUFFET

Warren Buffett is one of the most successful stock market investors. His entire
approach is to focus on the value of the business and its market price. Once Buffett
finds a business he understands and feels comfortable with, he acts like a business
owner rather than a stock market speculator. He studies everything possible about
the business, becomes an expert in that field and works with the management
rather than against them. In fact, often his first act on buying shares in any
company is to grant the managers his proxy vote for his shares to assure them that
he has no intention to try and move the company away from its core values.
Buffett champions the value investment strategy, and puts no credence in day to
day movements in share prices, the impact of the economic mood overall or any
other external factors. He maintains a long-term perspective at all times, and never
loses sight of the underlying value of a business.

THE BUFFET APPROACH TO INVESTMENT

Main Idea:
Rational allocation of capital is the key to any investment success.
The Buffett approach to investment is:
1. Never follow the day to day fluctuations of stock market.
In essence, a stock market exists simply to facilitate the buying and selling
of shares. Anytime an investor tries to turn the market into a predictor of
future prices, they run into problems.
The essential question is whether youve done your homework or not. If you
know more about a company than the market does, then why give any
attention to what the market says?
Secondly, if you buy a share because you believe a company has sound
financial prospects and you intend owning it for a number of years, what
happens in the market on a day to day basis is totally inconsequential.
An investor does not need the markets validation for any share purchase
they have completed.
The only use for a regular glance at the market is to check whether anyone is
foolish enough to sell a good business at a great price.

2. Dont try and analyze or worry about the general economy.

If it is impossible to predict what the stock market will do from day to day,
how can it be even remotely achievable to forecast what the economy as a
whole will do in the next few years?
The problem is some investors begin with an economic assumption about
the direction of the economy and select only stocks which fit their model. In
this way, the predictions become both self-fulfilling and limiting.
A superior approach is to buy a business which has a realistic opportunity to
progress regardless of whether the overall economy is expanding or
contracting. A business which has the ability to profit in any economic
environment is very valuable.
3. Buy a business, not its stock.
An investor should only buy shares in a company which he would be willing
to purchase outright if he had sufficient capital. From this perspective, an
investor should look for a company with business operations that are
understood, has favourable long-term prospects, is operated by honest and
competent people and is available at an attractive price.
The decision to buy a business is based on:
- Business tennets
- Management tennets
- Financial tennets
- Market tennets
4. Manage a portfolio of businesses.
The concept of intelligent investing is that by buying shares in a company,
you should act like the owner of the business, not the owner of a piece of
paper. That means you need to understand the companys operating
fundamentals.
Diversification is only required when an investor does not know what they
are doing. Very few business owners are comfortable and experienced
enough to operate a number of companies at the same time. So too, an
investor should act like an owner and buy shares only in companies which
are thoroughly understood.
INVESTMENT PORTFOLIO

COMPANY
WELLS FARGO-WFC
KRAFT HEINZ- KHC
COCA COLA CO.-KO
INTERNATIONAL BUSINESS
MACHINES - IBM
AMERICAN EXPRESS-AXP
PHILLIPS 66-PSX
PROCTER & GAMBLE-PG
WAL MART STORES-WMT
US BANCORP -USB
DAVITA HEALTHCARE PARTNERSDVA
MOODYS CORP -MCO
AT&T INC - T
GOLDMAN SACHS GROUP -GS
CHARTER COMMUNICATIONSCCMM
GENERAL MOTORS-GM
DEERE & CO -DE
U S G CORP -USG
PRECISION CASTPARTS -PCP
VERISIGN INC -VRSN
SUNCOR ENERGY INC -SU
BANK OF NEW YORK -BK
VISA INC -V
M & T BANK CORP -MTB
VERIZON COMMUNICATIONS -VZ
COSTCO WHSL CORP -COST
AXALTA COATING SYS LTD -AXTA
LIBERTY MEDIA CORP DELAWARE LMCK
LIBERTY GLOBAL PLC -LBTYA
MASTERCARD INC (CL A) MA
WABCO HLDGS INC -WBC
TORCHMARK CORP -TMK

No. of Shares
470,292,359
325,634,818
400,000,000
81,033,450

% of portfolio
18.95%
18.03%
12.59%
9.22%

151,610,700
61,486,926
52,793,078
56,185,293
85,063,167
38,565,570

8.82%
3.70%
2.98%
2.85%
2.73%
2.18%

24,669,778
59,320,756
10,959,519
10,281,603

1.90%
1.51%
1.49%
1.41%

50,000,000
17,052,110
39,002,016
4,200,792
12,985,000
30,000,000
20,112,212
9,885,160
5,382,040
15,000,928
4,333,363
23,199,474
15,386,257

1.17%
0.99%
0.81%
0.75%
0.71%
0.62%
0.61%
0.54%
0.51%
0.51%
0.49%
0.46%
0.41%

11,957,285
5,229,756
3,559,189
6,353,727

0.40%
0.36%
0.29%
0.28%

RESTAURANT BRANDS INTL INC

LIBERTY GLOBAL PLC (SHS CL C)
LBTYK
LIBERTY MEDIA CORP DELAWARE
LMCA
GENERAL ELECTRIC CO- GE
TWENTY FIRST CENTY FOX INC
FOXA
SANOFI - SNY
VERISK ANALYTICS INC -VRSK
CHICAGO BRIDGE & IRON CO - CBI

8,438,225
7,346,968

0.23%
0.23%

7,800,000

0.21%

10,585,502
8,951,869

0.20%
0.18%

3,905,875
1,563,434
1,983,190

0.14%
0.09%
0.06%

GRAHAM HLDGS CO -GHC

MEDIA GEN INC NEW -MEG
JOHNSON & JOHNSON -JNJ
NOW INC (COM) DNOW
MONDELEZ INTL INC - MDLZ
LIBERTY GLOBAL PLC
LIBERTY GLOBAL PLC
UNITED PARCEL SERVICE INC- UPS
LEE ENTERPRISES INC- LEE

107,575
3,471,309
327,100
1,825,569
578,000
517,139
367,348
59,400
88,863

0.04%
0.03%
0.02%
0.02%
0.01%
0.01%
0.00%
0.00%
0.00%