Charlie Munger

Charlie Munger

Last Update: 07-05-2018

Number of Stocks: 4
Number of New Stocks: 0

Total Value: $161 Mil
Q/Q Turnover: 0%

Countries: USA
Details: Top Buys | Top Sales | Top Holdings  Embed:

Charlie Munger' s Profile & Performance

Profile

Charlie Munger is the Chairman of Wesco Financial. He is also the Vice Chairman of Berkshire Hathaway, where his long term partner Warren Buffett serves as Chairman. Like Buffett, Munger is a native of Omaha, Nebraska. After studies in mathematics at the University of Michigan, and service in the U.S. Army Air Corps as a meteorologist, trained at Caltech, he entered Harvard Law School without an undergraduate degree. Graduating in 1948 with a Juris Doctor magna cum laude, he founded and worked as a real estate attorney at Munger, Tolles & Olson LLP until 1965. He then gave up the practice of law to concentrate on managing investments.

In his book Poor Charlie's Almanack, Munger has introduced the concept of "Elementary, Worldly Wisdom" as it relates to business and finance. Munger's worldly wisdom consists of a set of mental models framed as a latticework to help solve critical business problems.

Investing Philosophy

Buffett followers believe that Charlie Munger had significant influence on Warren Buffett’s investment philosophy. Before partnering with Munger, Buffett was a Ben Graham type of cigar butt bargain investor. Charlie Munger inspired Warren Buffett to invest in high quality business for long term. The latest investment Charlie Munger convinced Warren Buffett was the investment in Chinese electric car maker BYD.

Total Holding History

Top Ranked Articles

How Warren Buffett Squeezes So Much Value Out of So Few Stock Ideas How much value you get out of a single stock idea depends on how big your position size is, how long you hold the stock, how fast the stock compounds its value and how cheap it is
Charlie Munger (Trades, Portfolio) has said “good ideas are rare.” Warren Buffett (Trades, Portfolio) often talks about the idea of a punch card with just 20 punches on it. Each time you buy a stock – you use up one punch. Buffett believes anyone who invests that way will become a better investor. Is that true, though? Just how many ideas does an investor need, and how much juice can you really squeeze out of just one idea? Read more...
What Can We Do Now? Part II A list of ways to help us remain calm
About four months ago, I wrote an article titled “What Can We Do Now?” Since then the market continued to rise undisrupted until this week. This headline from CNBC summarized what happened – “Dow Plummets 666 points, capping worst week in two years.” I was just on CNBC’s mobile website and the first 10 headlines are all about the Friday sell-off. The CBOE Volatility Index shot up 28.5% in one day. There’s little doubt that there’s wide spread mini panic in the market. The question of “what can we do now?” is again on investors’ mind. But this time the seeking of an answer seems much more urgent and important than when I wrote the article in September last year. Read more...
Short-Term Noise and Long-Term Investing An example of why long-term investing is harder than it sounds
Under Armour Inc. (NYSE:UA) (NYSE:UAA) reported ugly results on Tuesday. Most notably, management cut 2017 guidance across the board, giving analysts another reason to doubt the company (there are few things the street hates more than a company that cannot predict results six to twelve months out with pinpoint accuracy). Sales growth has slowed and margins are under pressure. UA is experiencing some pressure. As an investor, this is a frustrating period. Read more...
The Good Shepherd Investor We feel we serve as a shepherd of our concentrated stock portfolio and of our end clients and shareholders
David was the king of Israel and the writer of many of the Psalms. He spent his formative years as a shepherd and framed his life’s work around the key concepts from his profession. Herds were the primary form of wealth back then, while common stocks are a primary form today. We feel we serve as a shepherd of our concentrated stock portfolio and of our end clients and shareholders. As we get ready for the next phase in the U.S. stock market, we thought it would be helpful to compare what we do with what David did as a good shepherd. Read more...
Musings From Omaha Thoughts and observations from the 2018 Berkshire meeting
Last weekend I made my seventh annual pilgrimage to Omaha for the Berkshire Hathaway annual shareholder meeting. It was the first time I attended the meeting as an international shareholder (I flew from Shanghai to Omaha this year). As always, I had a ton of fun catching up with old friends and meeting new friends. The only complaint I have is that the weekend went by too fast. But as they say: Time flies when you are having fun. Read more...
» More Charlie Munger Articles

Charlie Munger is an American business magnate and investor.  He is Vice-Chairman of Berkshire Hathaway Corporation, led by Warren Buffett.  Buffett has often publicly stated that he regards Munger as his partner.  Although Munger is the Vice-Chairman, he is not involved in the day-to-day operations at Berkshire and much more private than Buffett.  Munger and Buffett did not meet until 1959, although they grew up a half a block from where they lived.  Munger has been the chairman of Wesco Financial Corporation since 1984, now owned by Berkshire Hathaway.  He is also the chairman of the Daily Journal Corporation and a director of Costco Wholesale Corporation.  Munger ran his own investments from 1962 to 1975 without Buffett, and according to Buffett's essay, "The Superinvestors of Graham-and-Doddsville,” Munger earned compound annual returns of 19.8% during the 1962 to 1975 compared to only 5.0% of the Dow.  When Munger managed of the portfolio of The Daily Journal in the 10 years up to 2012, he took the company’s portfolio value from $4.3 million to $76.7 million.  Munger make decision on what Benjamin Franklin would do given the situation.  Like Warren Buffett, Munger believes in holding substantial amount of stocks that he knows extremely well and wait for long term returns.  Munger has been described as an independent thinker who is very talented in making connections from a vast amount of knowledge.


Education
Charlie Munger is native to Omaha, Nebraska.  He studies mathematics at the University of Michigan and serviced in the U.S. Army Air Corps as a meteorologist.  Then Munger attended Caltech and transferred into Harvard Law School.  There he was a member of the Harvard Legal Aid Bureau, without an undergraduate degree, and graduated in 1948 with a Juris Doctor magna cum laude.  Munger founded and worked as a real estate attorney at Munger, Tolles & Olson LLP until 1965 when he gave up the practicing law to concentrate on managing investments.  He first partnered up with Otis Booth in real estate development then partnered with Jack Wheeler to form Wheeler, Munger, and Company an investment firm on the Pacific Coast Stock Exchange.  He wound up Wheeler, Munger in 1976 after losses of 31% in 1973 and 1974.

Wesco Financial Corporation
Munger was the chairman of Wesco Financial Corporation since 1984 before joining Berkshire Hathaway in 2011.  Wesco Financial is based in Pasadena, California where the company's annual shareholders' meeting was typically held after the Berkshire Hathaway annual meetings.  Wesco Financial originated as a savings and loan association that grew to control Kansas Bankers Surety Company, Precision Steel Corp., CORT Furniture Leasing, and other ventures.  It had held an equity portfolio of over $1.5 billion dollars including companies such as Goldman Sachs, Wells Fargo, Procter & Gamble, Kraft Foods, US Bancorp, and Coca-Cola.  

Philanthropy
In 2007, Munger made a $3 million donation to the University of Michigan Law School for lighting improvements in Hutchins Hall and the William W. Cook Legal Research Building.  Then again in 2011, Munger contributed another $20 million out of the $39 million in costs for renovations to the Lawyers Club housing complex.  Therefore, the new section in the Lawyers Club will be renamed the Charles T. Munger Residences in his honor.  Once more on December 28, 2011, Munger donated 10 shares of Berkshire Hathaway Class A stock, which is worth about $1.2 million in total, to the University of Michigan.

With Munger’s wife and daughter being alumnus of Stanford University and his daughter currently a member of the board, Munger donated 500 shares of Berkshire Hathaway Class A stock, valued at $43.5 million at the time, to Stanford in 2004 for a graduate student housing complex that can house 600 students. 
In 1997, Munger and his wife, who was an alumna, donated $1.8 million to the Marlborough School in Los Angeles.  They also donated to the Polytechnic School in Pasadena and the Los Angeles YMCA.

Munger has been a trustee as well as the chair of the board of trustees at the Harvard-Westlake School in Los Angeles for more than 40 years.  His five sons and stepsons and so far one grandson graduated from the prep school, and naturally, over the years Munger had contributed generously to the school.  The Mungers had first contributed $13 million to the Munger Science Center at the high school campus opened in 1995.  In 2006, Munger donated 100 shares of Berkshire Hathaway Class A stock, valued at $9.2 million, to the school toward buildings at Harvard-Westlake's middle school campus.  Then again in 2009, Munger donated eight shares of Berkshire Hathaway Class A stock, valued at $800,000.  

Business Philosophy
Similar to Buffett, Munger has a Benjamin Graham-style approach, and he is focused on investing in undervalued businesses with economic moats.
Munger believes that incentives explain why people behave the way they do.  He believes in the value of highly ethical business standards and said, "Good businesses are ethical businesses.  A business model that relies on trickery is doomed to fail," in the 2009 Wesco Financial Corporation annual meeting.  Munger considers reputation and integrity are the most valuable assets and can be lost in a heartbeat. 

It is better to tightly grip the obvious than some esoteric matter though do not overlook the obvious and drown out the details.  Allocate the relative attention according to the situation, and do not avoid your fears or troubles that may come back and hurt you.  The obvious usually consists of the future, so consider totality of risk and effect including potential second order and higher levels of impact. 

When analyzing value and price, it is important to determine value apart from price because they are not the same.  This idea of separating even the slightest of concepts is common for Munger.  He also suggests separating progress from activity and wealth from size.  In the end, to Munger it is about being a business analyst not a market, macroeconomic, or security analyst. 

Proper allocation of capital is an investor’s primary objective.  The best use of capital is always measured by the nest best use or essentially the opportunity cost.  Great ideas are rare so learn to recognize those opportunities and act accordingly.  When a proper circumstance presents itself, act decisively with conviction but be aware of others.  Munger has suggested the mentality of being fearful when others are greedy and be greedy when others are fearful, essentially, the mind must be always be prepared for any opportunity.  But always remember to never love an investment irrationally, you still must be situation-dependent and opportunity-driven.  It is about resisting to natural human bias.  To Munger, making correct decisions of allocating any capital at any given time is how to become a better investor.  Along the way of investing, patience is a virtue in enjoying the process as well as the proceeds, so avoid unnecessary transactional taxes and frictional costs.  Nevertheless, adapt to the true nature of the world since it will not adapt to you.  Make decisions after recognizing and accepting unmemorable complexities of the world, especially the aspects you do not like.

Personality
When judging the natural occupational hazard of risk, Munger has a few guide lines that he follows and advises.  Obviously, among the first are to leave an appropriate margin of safety, ensure proper compensation for the risk, and beware of inflation and interest rate exposures.  Munger also advises to avoid people of questionable character.  More importantly, risks should avoid the big mistake of permanent capital losses.

Munger’s reason and inspiration in quitting being a lawyer as well as his personality has been a pursuit of independence.  He believes objectivity and rationality is required for independent thought and therefore the best decisions.  Whether people agree or disagree with you is irrelevant, what matters is the correlation and justification of the decision led from an accurate analysis.  Naturally, mimicking the herd merely leads so average performance which is not what Munger does or independent. 

Munger highly values preparation.  He believes in the will to prepare more than just the will to work and succeed.  One aspect of becoming successful is to develop fluency mentally by devoting to be a lifelong self-learner through vigorous reading and curiosity in attempt to be wiser every day.  Education in various disciplines is a notable quality that makes Munger a wise thinker.  Preparing also requires asking the right questions and that always includes numerous whys.  Also Munger always desires to invert by reevaluating reasons to like and dislike a stock before buying.

True wisdom is also defining the limits of competence.  It is always important to identify and reconcile false evidence.  Having humility in intelligence is the way to resist the craving for false perception and certainties.  Just imagine that you are already gullible so never try to fool yourself farther.  Always challenge yourself and continually improve your best ideas.

Business Opinions
Munger "think gold is a great thing to sew into your garments if you're a Jewish family in Vienna in 1939, but I think civilized people don't buy gold. They invest in productive businesses," just like Buffett.

Munger admires China’s policies and policy makers that transformed it from a “Communist bureaucracy” nation to the prosperity of today without major wars.  With only population control and some intelligent policy making promoting free market, China’s ability to raise its massive population from the brink of starvation to the welfare of the people today is admirable, and he compares this to the transformation of Singapore. 

Hypothetically Munger has said he would like to stop short term trading in the stock market because it leads to too much problems and it is essentially gambling.  Because there are too much liquidity in the stock market including derivatives, Munger would if he could tax short term trades to reduce what is basically gambling and hedge funds reporting their pay as long term capital gains. 

Munger convinced Buffett to invest in Chinese electric car maker BYD.  Munger justified it as the exception to the rule that Berkshire avoids technology companies because the CEO is so talented and has right character worth investing in.

Buffett and Munger believe in the efficient market theory, that the market is mostly efficient most of the time. 

Personal Opinions
Munger uses the term Lollapalooza effect that describes what happens when more than one biases or incentives act at the same time causing major misjudgment.
Munger uses the term "Elementary, Worldly Wisdom" describing that you cannot really know anything with just isolated facts.  If the facts do not connect together on a latticework of theory, they are not usable.

There is more sin today in business conduct and the political system today than before. 

Munger does not think the presidential election and either presidential candidate will effect much change to the financial market.

Buffett and Munger share many similar principles and work well together with few difference, among one is Buffett is a Democrat while Munger is a Republican.  
Munger does not think it is necessary for most people to be terribly facile in statistics. 

Munger want to be remembered as a great teacher.

Charlie Munger’s Investing Principles Checklist:
from Poor Charlie’s Almanack

Risk – All investment evaluations should begin by measuring risk, especially reputational
* Incorporate an appropriate margin of safety
* Avoid dealing with people of questionable character
* Insist upon proper compensation for risk assumed
* Always beware of inflation and interest rate exposures
* Avoid big mistakes; shun permanent capital loss

Independence – “Only in fairy tales are emperors told they are naked”
* Objectivity and rationality require independence of thought
* Remember that just because other people agree or disagree with you doesn’t make you right or wrong – the only thing that matters is the correctness of your analysis and judgment
* Mimicking the herd invites regression to the mean (merely average performance)

Preparation – “The only way to win is to work, work, work, work, and hope to have a few insights”
* Develop into a lifelong self-learner through voracious reading; cultivate curiosity and strive to become a little wiser every day
* More important than the will to win is the will to prepare
* Develop fluency in mental models from the major academic disciplines
* If you want to get smart, the question you have to keep asking is “why, why, why?”

Intellectual humility – Acknowledging what you don’t know is the dawning of wisdom
* Stay within a well-defined circle of competence
* Identify and reconcile disconfirming evidence
* Resist the craving for false precision, false certainties, etc.
* Above all, never fool yourself, and remember that you are the easiest person to fool

“Understanding both the power of compound interest and the difficulty of getting it is the heart and soul of understanding a lot of things.”

Analytic rigor – Use of the scientific method and effective checklists minimizes errors and omissions
* Determine value apart from price; progress apart from activity; wealth apart from size
* It is better to remember the obvious than to grasp the esoteric
* Be a business analyst, not a market, macroeconomic, or security analyst
* Consider totality of risk and effect; look always at potential second order and higher level impacts
* Think forwards and backwards – Invert, always invert

Allocation – Proper allocation of capital is an investor’s number one job
* Remember that highest and best use is always measured by the next best use (opportunity cost)
* Good ideas are rare – when the odds are greatly in your favor, bet (allocate) heavily
* Don’t “fall in love” with an investment – be situation-dependent and opportunity-driven

Patience – Resist the natural human bias to act
* “Compound interest is the eighth wonder of the world” (Einstein); never interrupt it unnecessarily
* Avoid unnecessary transactional taxes and frictional costs; never take action for its own sake
* Be alert for the arrival of luck
* Enjoy the process along with the proceeds, because the process is where you live

Decisiveness – When proper circumstances present themselves, act with decisiveness and conviction
* Be fearful when others are greedy, and greedy when others are fearful
* Opportunity doesn’t come often, so seize it when it comes
* Opportunity meeting the prepared mind; that’s the game

Change – Live with change and accept unremovable complexity
* Recognize and adapt to the true nature of the world around you; don’t expect it to adapt to you
* Continually challenge and willingly amend your “best-loved ideas”
* Recognize reality even when you don’t like it – especially when you don’t like it

Focus – Keep things simple and remember what you set out to do
* Remember that reputation and integrity are your most valuable assets – and can be lost in a heartbeat
* Guard against the effects of hubris (arrogance) and boredom
* Don’t overlook the obvious by drowning in minutiae (the small details)
* Be careful to exclude unneeded information or slop: “A small leak can sink a great ship”
* Face your big troubles; don’t sweep them under the rug

In the end, it comes down to Charlie’s most basic guiding principles, his fundamental philosophy of life: Preparation. Discipline. Patience. Decisiveness.

Additional Quotes
“All intelligent investing is value investing - acquiring more than you are paying for. You must value the business in order to value the stock.”

“Spend each day trying to be a little wiser than you were when you woke up.”

“In my whole life, I have known no wise people (over a broad subject matter area) who didn't read all the time - none, zero.”

“Mimicking the herd invites regression to the mean.”

"We both insist on a lot of time being available almost every day to just sit and think. That is very uncommon in American business. We read and think. So Warren and I do more reading and thinking and less doing than most people in business. We do that because we like that kind of a life. But we've turned that quirk into a positive outcome for ourselves."

"Warren is one of the best learning machines on this earth. The turtles who outrun the hares are learning machines. If you stop learning in this world, the world rushes right by you."

"There are two kinds of businesses: The first earns 12%, and you can take it out at the end of the year. The second earns 12%, but all the excess cash must be reinvested - there's never any cash. It reminds me of the guy who looks at all of his equipment and says, 'There's all of my profit.' We hate that kind of business."

"You need a different checklist and different mental models for different companies. I can never make it easy by saying, 'Here are three things.' You have to derive it yourself to ingrain it in your head for the rest of your life."

"What matters most: passion or competence that was born in? Berkshire is full of people who have a peculiar passion for their own business. I would argue passion is more important than brain power."

“Most ambitious young men will be more aggressive than they should. That's what happened with investment banking. I mean, look at Lehman Brothers. Everyone did what they damn well wanted until the whole place was pathological about its extremeness.”  “The smart way to regulate is to act like a referee. You have to curtail the activities that are permitted. There should be less trying to fix things and more trying to prevent bad outcomes.”

“The world would be better off if JPMorgan didn't run a gambling casino alongside a legitimate business.”

“We have a tendency in America to think everyone should do it just like us. I don't think that's necessarily true. What has worked for us socially might not work for China. Actually, it almost certainly won't.”

“Choose clients as you would friends. ”

“The best armour of 0ld age is a well-spent life preceding it. ”

When you borrow a man’s car, always return it with a tank of gas. ”

“If only I had the influence with my wife and children that I have in some other quarters! ”

“Take a simple idea and take it seriously. ”

“In business we often find that the winning system goes almost ridiculously far in maximizing and or minimizing one or a few variables — like the discount warehouses of Costco. ”

“Don’t do cocaine. Don’t race trains. And avoid AIDS situations. ”

“We look for a horse with one chance in two of winning and which pays you three to one. ”

“You’re looking for a mispriced gamble. That’s what investing is. And you have to know enough to know whether the gamble is mispriced. That’s value investing. ”

“It takes character to sit there with all that cash and do nothing. I didn’t get to where I am by going after mediocre opportunities. ”

“A great business at a fair price is superior to a fair business at a great price. ”

“All intelligent investing is value investing — acquiring more than you are paying for. ”

You must value the business in order to value you the stock. ”

No wise pilot, no matter how great his talent and experience, fails to use his checklist. ”

There are worse situations than drowning in cash and sitting, sitting, sitting. I remember when I wasn’t awash in cash — and I don’t want to go back. ”

…it never ceases to amaze me to see how much territory can be grasped if one merely masters and consistently uses all the obvious and easily learned principles. ”

Once you get into debt, it’s hell to get out. Don’t let credit card debt carry over. You can’t get ahead paying eighteen percent. ”

If you always tell people why, they’ll understand it better, they’ll consider it more important, and they’ll be more likely to comply. ”

Spend less than you make; always be saving something. Put it into a tax-deferred account. Over time, it will begin to amount to something. This is such a no-brainer. ”

You don’t have to be brilliant, only a little bit wiser than the other guys, on average, for a long, long time. ”

Three rules for a career: 1) Don’t sell anything you wouldn’t buy yourself; 2) Don’t work for anyone you don’t respect and admire; and 3) Work only with people you enjoy. ”

I won’t bet $100 against house odds between now and the grave. ”

I try to get rid of people who always confidently answer questions about which they don’t have any real knowledge. ”

…being an effective teacher is a high calling. ”

I believe in the discipline of mastering the best that other people have ever figured out. I don’t believe in just sitting down and trying to dream it all up yourself. Nobody’s that smart…”

Without numerical fluency, in the part of life most of us inhibit, you are like a one-legged man in an ass-kicking contest. ”

“In my life there are not that many questions I can’t properly deal with using my $40 adding machine and dog-eared compound interest table.”

Charlie Munger’s Performance of his limited partnership:


Year
Mass. Inv. Trust (%) Investors Stock (%) Lehman (%) Tri-Cont. (%) Dow (%) Overall Partnership (%) Limited Partners (%)
Yearly Results              
1962 -9.8 -13.4 -14.4 -12.2 -7.6 30.1 20.1
1963 20 16.5 23.8 20.3 20.6 71.1 47.8
1964 15.9 14.3 13.6 13.3 18.7 49.7 33.1
1965 10.2 9.8 19 10.7 14.2 8.4 6
1966 -7.7 -9.9 -2.6 -6.9 -15.7 12.4 8.3
1967 20 22.8 28 25.4 19 56.2 37.5
1968 10.3 8.1 6.7 6.8 7.7 40.4 27
1969 -4.8 -7.9 -1.9 0.1 -11.6 28.3 21.3
1970 0.6 -4.1 -7.2 -1 8.7 -0.1 -0.1
1971 9 16.8 26.6 22.4 9.8 25.4 20.6
1972 11 15.2 23.7 21.4 18.2 8.3 7.3
1973 -12.5 -17.6 -14.3 -21.3 -13.1 -31.9 -31.9
1974 -25.5 -25.6 -30.3 -27.6 -23.1 -31.5 -31.5
1975 32.9 33.3 30.8 35.4 44.4 73.2 73.2
               
Compound Results              
1962 -9.8 -13.4 -14.4 -12.2 -7.6 30.1 20.1
1962-3 8.2 0.9 6 5.6 11.5 123.4 77.5
1962-4 25.4 15.3 20.4 19.6 32.4 234.4 136.3
1962-5 38.2 26.6 43.3 32.4 51.2 262.5 150.5
1962-6 27.5 14.1 39.5 23.2 27.5 307.5 171.3
1962-7 53 40.1 78.5 54.5 51.8 536.5 273
1962-8 68.8 51.4 90.5 65 63.5 793.6 373.7
1962-9 60.7 39.4 86.9 65.2 44.5 1046.5 474.6
1962-70 61.7 33.7 73.4 63.5 57.1 1045.4 474
1962-71 76.3 56.2 119.5 100.1 72.5 1336.3 592.2
1962-72 95.7 79.9 171.5 142.9 103.9 1455.5 642.7
1962-73 71.2 48.2 132.7 91.2 77.2 959.3 405.8
1962-74 27.5 10.3 62.2 38.4 36.3 625.6 246.5
1962-75 69.4 47 112.2 87.4 96.8 1156.7 500.1
Average Annual Compounded Rate 3.8 2.8 5.5 4.6 5 19.8 13.7

Books

  • Poor Charlie's Almanack: The Wit and Wisdom of Charles T. Munger, Expanded Third Edition by Peter D. Kaufman
  • “Academic Economics: Strengths and Faults After Considering Interdisciplinary Needs” Herb Kay Undergraduate Lecture University of California, Santa Barbara Economics Department By Charles T. Munger
  •  Benjamin Franklin by Carl Van Doren
  • Influence: The Psychology of Persuasion (Collins Business Essentials) by Robert B. Cialdini
  • Seeking Wisdom: From Darwin to Munger, 3rd Edition by Peter Bevelin

Additional Articles
Charlie Munger: Art of Stock Picking: BRK.A, BRK.B
Charlie Munger: Art of Stock Picking (Part II)
Notes from a Morning with Charlie Munger; Comments on Greece, Berkshire Hathaway, Costco, USB, WFC

Commentaries and Stories

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Charlie Munger on Berkshire’s Rationale for Investment in Salomon Brothers Munger explained why Berkshire bought company that collapsed Charlie Munger - Charlie Munger On Berkshire’s Rationale For Investment In Salomon Brothers
While going through the July 1989 issue of Outstanding Investors Digest, I found an interesting excerpt from the 1989 Wesco Meeting in which Charlie Munger (Trades, Portfolio) talked about Berkshire Hathaway’s rationale for its investment in Salomon Brothers. More...

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Charlie Munger's 'The Art of Stock Picking' A takeaway from this landmark Munger text Charlie Munger - Charlie Munger's 'The Art Of Stock Picking'
"The Art of Stock Picking" by Charlie Munger (Trades, Portfolio) is required reading for value investors. If you have not read it, I highly recommend you go out and find a copy. More...

VALUE, VALUE INVESTING, CHARLIE MUNGER


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Why Art and Investing Have Much in Common Becoming a good artist is similar to become a good investor Charlie Munger - Why Art And Investing Have Much In Common
I've found that, more often than not, in the social events that come with the summer months, the conversation at some point moves on to finance and investing. More...

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Charlie Munger’s 2nd Quarter Portfolio Sage continues to allow time to reward him for 4 highly profitable investments Charlie Munger - Charlie Munger’s 2nd Quarter Portfolio
Many people don’t know that Berkshire Hathaway (NYSE:BRK.A)(NYSE:BRK.B) vice chairman Charlie Munger (Trades, Portfolio) manages his own portfolio, possibly because he hasn’t changed it since 2014. Indeed, in the second quarter, Warren Buffett (Trades, Portfolio)’s sage business partner didn’t touch a share, opting to hang on to his favorites and allow time to reward him. Each is down slightly year to date, but that puts hardly a dent in his long-term gains. More...

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‘One Up on Wall Street’: Prologue and Introduction Peter Lynch explains how non-professional investors can find an edge in the markets Warren Buffett, Charlie Munger - ‘One Up On Wall Street’: Prologue And Introduction
Peter Lynch has an amazing investment record. During his 13 years of managing the Magellan Fund at Fidelity Investments, he brought in average annual returns of more than 29%. His successes brought new respect and popularity for mutual funds, vast inflows to his fund and his first book about investing was a best seller. More...

PETER LYNCH, “ONE UP ON WALL STREET”, PROLOGUE AND INTRODUCTION, MAGELLAN FUND, FIDELITY INVESTMENTS, DUMB MONEY, COMMON KNOWLEDGE, L'EGGS, HANES, MUTUAL FUNDS, TENBAGGERS, MULTIBAGGERS, SUBARU


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Global Dominance Via Stocks, Not War Of the 10 largest companies in the S&P 500 Index, 5 are technology companies. Global dominance at the risk of regulatory and political risk isn’t our goal as investors Warren Buffett, Charlie Munger - Global Dominance Via Stocks, Not War
In the 1960s, the slogan “Make Love, Not War” became a rally cry for anti-war protestors, but also typified their free love expression. They used the slogan to explain the harshness of the situation in Vietnam and to be countercultural to the capitalist and traditional way of life they saw in American society. While this was countercultural for its time, a recent Goldman Sachs piece titled “Why Technology is not a bubble” shows how today’s circumstances are contrary to rationale [1]. Their work shows a contrast between the pricing of stocks to the economic value of populations. It is our opinion that this looks to be extreme. As we unpack this contrast, we will learn the hippies of the '60s were only partly right. They were right about war. However, for today’s venture capitalists and technology investors, making love would be a waste of time relative to global dominance via the capitalization of individual stocks. Future world tyrants, take heed. More...

VALUE INVESTING, REGULATORY RISK, TECH, CHARLIE MUNGER


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Value Screeners Identify Good Opportunities for 2nd Half of 2018 A look at warning signs and investing strategies from Peter Lynch and Warren Buffett Warren Buffett, Charlie Munger, David Abrams, Rich - Value Screeners Identify Good Opportunities For 2nd Half Of 2018
The Peter Lynch Growth screener listed four companies with high business predictability and at least two more positive investing signs than severe warning signs: Allegiant Travel Co. (NASDAQ:ALGT), Big Lots Inc. (NYSE:BIG), Mednax Inc. (NYSE:MD) and Amerco Inc. (NASDAQ:UHAL). More...

WARREN BUFFETT, PETER LYNCH, VALUE INVESTING, DAVID ABRAMS, RICHARD SNOW


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Restaurants: Buy the Dip? A deep look at top restaurant companies like McDonald’s and Starbucks Warren Buffett, Charlie Munger - Restaurants: Buy The Dip?
Despite recent price drops, restaurant companies like McDonald’s Corp. (NYSE:MCD), Starbucks Corp. (NASDAQ:SBUX) and Yum Brands Inc. (NYSE:YUM) still have profit margins that outperform the industry median. More...

WARREN BUFFETT, RESTAURANTS


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Semiconductor Companies Showing Good Value Potential Despite Trade War Fears Taiwan-based semiconductor company makes both undervalued predictable and Buffett-Munger screeners Warren Buffett, Charlie Munger - Semiconductor Companies Showing Good Value Potential Despite Trade War Fears
Despite increasing fears of a U.S.-China trade war, semiconductor companies like Taiwan Semiconductor Co. Ltd. (NYSE:TSM)(TPE:2330) and IPG Photonics Corp. (NASDAQ:IPGP) still made the undervalued predictable screener and Buffett-Munger screener as of Tuesday. More...

WARREN BUFFETT, SEMICONDUCTORS, CHINA


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The Voting Machine vs. the Weighing Machine Graham used the statement to highlight that, from time to time, the stock market can become nothing more than a beauty pageant Warren Buffett, Charlie Munger - The Voting Machine Vs. The Weighing Machine
The patriarch of value investing, Benjamin Graham, once said, “In the short run the market is a voting machine, but in the long run it is a weighing machine.” His statement is just as profound as the day it was first spoken. However, it is timelessly mystifying to most investors. Graham used the statement to highlight that, from time to time, the stock market can become nothing more than a beauty pageant, slapping high price-earnings ratios and valuations on the current darlings. We believe in sustainable wealth creation and looking for meritorious companies that, for one reason or another, are considered ugly or unglamorous. The fundamental value which underlies them in the marketplace could produce sustainable value to the owners. More...

MUNGER, GRAHAM, BUFFETT, VALUE,


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New York & Co.: Why You Need to Buy Deep Value The value world is enthralled with Warren Buffett and moats, but does that mean you should buy deep value? Charlie Munger - New York & Co.: Why You Need To Buy Deep Value
The value world is enthralled with Warren Buffett (Trades, Portfolio) and moats, but does that mean you should buy deep value? More...

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Charlie Munger's 2-Step Decision Process I've recently been on a sort of virtual Charlie Munger pilgrimage Charlie Munger - Charlie Munger's 2-Step Decision Process
I've recently been on a sort of a virtual Charlie Munger (Trades, Portfolio) pilgrimage, seeking out interviews and writings the billionaire has given over the years, and tips he's presented on how to be the best you can be at life. More...

VALUE, VALUE INVESTING, CHARLIE MUNGER, WARREN BUFFETT


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Charlie Munger: The 4 Steps of Investment Buffett's partner speaks about his process Charlie Munger - Charlie Munger: The 4 Steps Of Investment
Charlie Munger (Trades, Portfolio) is one of the wealthiest men in the world, and one of the world's best thinkers. More...

VALUE, VALUE INVESTING, CHARLIE MUNGER, WARREN BUFFETT


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Investing Lessons to Learn From the Gurus Warren Buffett, George Soros, Carl Icahn and other greats have been teaching us lessons for years. Here are the most important Charlie Munger,George Soros - Investing Lessons To Learn From The Gurus
The gurus of the investing world are some of the wealthiest people in the world. Using their knowledge of the market, these gurus have turned pennies into millions, and millions into billions. So, it’s no wonder that so many people track the movements of these top-notch investors. What are the most important lessons they can teach us? That depends on which guru you ask. Nonetheless, here are five necessities that market gurus have shown to be overwhelmingly important in the process of building wealth. More...

GURUS, LESSONS, STRATEGY


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Warren Buffett’s Market Indicator Rises Near All-Time High Dow Jones surpasses 25,000 milestone for the second time in the past three weeks Warren Buffett, Charlie Munger - Warren Buffett’s Market Indicator Rises Near All-Time High
On June 6, Warren Buffett (Trades, Portfolio)’s market indicator reached 143.6%, approximately 5% lower than its all-time high of 148.5%. Additionally, the Dow Jones Industrial Average eclipsed 25,000 for the second time since May 21. More...

WARREN BUFFETT, MARKET VALUATION, CHARLIE MUNGER, DOW JONES


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To Succeed at Value Investing, You Need to Change Charlie Munger emphasizes the importance of fishing in the right pond Warren Buffett, Charlie Munger - To Succeed At Value Investing, You Need To Change
"It's gotten hard in the United States," Charlie Munger (Trades, Portfolio) said in an interview with Yahoo Finance at the beginning of May, "to find easy value investments because the world is so competitive." More...

VALUE, VALUE INVESTING, CHARLIE MUNGER, WARREN BUFFETT


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Book Review: 'How We Learn: The Surprising Truth About When, Where and Why It Happens' by Benedict Carey First part of Carey's book Warren Buffett,Charlie Munger - Book Review: 'How We Learn: The Surprising Truth About When, Where And Why It Happens' By Benedict Carey
One common trait of all extraordinary investors is their extraordinary learning ability. The greatest investors such as Warren Buffett (Trades, Portfolio) and Charlie Munger (Trades, Portfolio), are also the greatest learners. Faster, better and more learning compounds over time. As Charlie Munger (Trades, Portfolio) correctly pointed out: “Without Warren Buffett (Trades, More...

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Charlie Munger's Advice on How to Succeed at Life Munger on the best way to be your best self Charlie Munger - Charlie Munger's Advice On How To Succeed At Life
Charlie Munger (Trades, Portfolio) is Warren Buffett (Trades, Portfolio)'s right-hand man at Berkshire Hathaway (NYSE:BRK.A)(NYSE:BRK.B) and also one of the most prominent thinkers in the investment world. In fact, Munger is better known for his views on life, psychological principles and talks on how to succeed at life than he is for his investing success. Whenever Munger speaks, it always pays to listen, and we're tremendously lucky to have him as part of the investment community. More...

VALUE, VALUE INVESTING, BERKSHIRE HATHAWAY, WARREN BUFFETT, CHARLIE MUNGER


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May 15 Forum Update: 'Buffett CNBC' Edition A summary of Forum activity for April and May Warren Buffett, Charlie Munger, Francis Chou - May 15 Forum Update: 'Buffett CNBC' Edition
Throughout April and May, our GuruFocus Forum users shared several meaningful posts on value investing. The top posts included: More...

WARREN BUFFETT, FRANCIS CHOU, VALUE INVESTING FORUM, UNDERVALUED PREDICTABLE, VALUE SCREENERS


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Musings From Omaha Thoughts and observations from the 2018 Berkshire meeting Tom Russo,Charlie Munger - Musings From Omaha
Last weekend I made my seventh annual pilgrimage to Omaha for the Berkshire Hathaway annual shareholder meeting. It was the first time I attended the meeting as an international shareholder (I flew from Shanghai to Omaha this year). As always, I had a ton of fun catching up with old friends and meeting new friends. The only complaint I have is that the weekend went by too fast. But as they say: Time flies when you are having fun. More...

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