Why do you think that despite making your methods publicly available, that relatively few people have been able to emulate your success?
Buffett:
I asked Graham the same question. Everyone took his class at Columbia Business School. He used current examples, and by the end of the semester you would have a portfolio that would’ve made you money. Graham lived a life of sharing. He may have had more money hoarding, but lived happier because of it. The money’s just a figure in the paper, perhaps he would’ve died with 86 million instead of 42 million, but it doesn’t really matter. 90% of the people that took his class ended up doing something else.
At age 11 I started investing, purchasing three shares of Cities Service Preferred. I had read every book on investing in the Omaha library. I was really into charting and technical analysis. I loved it, but didn’t make any money from it. At 19 I read Graham’s “The Intelligent Investor” and it changed my world. Did Ben lose because I read his book? Maybe we competed and he made less money, but it didn’t matter to Graham.
The philosophy either takes immediately or it doesn’t at all. The reason gets down to temperament. People want to make money fast, but it doesn’t happen that way. Graham’s philosophy doesn’t promise enough for many people. You don’t know when it will happen, but you just wait for the fat pitches within your circle of competence. It’s not as exciting as guessing whether the stock price will go up the next day. Most investors in internet companies didn’t know the market cap. They were buying because they thought the stock would move, but if you asked them to write “I would buy XYZ company for $6 billion because”, they wouldn’t get halfway through the sentence. It’s the classic tortoise versus hare, bound to work over time. Charlie and I have educated competitors. Most don’t compete with us, though. It’s fine, we have more than enough money.
- A living example. Is there any example for technical analysis?
There is an exact science in school. There is an exact method for scoring science subjects, mathematics. These were scientific subject. Started with an assumption, continued with observation, and then ended with conclusion. That is what we come to know as scientific studies and methodogy. There is always fixed solutions or fixed method to solving the problem. You can not add a figure using logarithm. But we can use matrix, multiplication, division even if they are harder. But the answer will always be correct.
Artistic studies are subjective and have no fixed forms. But in some ways, there are rules and boundaries in application of art methods where you can copy and replicate the results. You can still produce a reasonable artistic result by following fixed methods.
Fixed methods are the scientific study of art.
We can be sure that using a fixed method for art will contain no individual free form and will not be outstanding.
But how many people around you are outstanding at art? I know am terrible at art.
The general person will be much better off applying scientific methods or fixed steps copying the artwork and produce a generally good results.
So, is investing an art or science?
Either way, I humbly think that a scientific method be it a study or a scientific copy of the artistic methods are the best way to generate a reasonable return on capital. Most likely not an outstanding performance but it will be a reasonably good performance.
I agree with BC. No arguments intended. Just for constructive discussion.
Austin:
ReplyDeleteWhy do you think that despite making your methods publicly available, that relatively few people have been able to emulate your success?
Buffett:
I asked Graham the same question. Everyone took his class at Columbia Business School. He used current examples, and by the end of the semester you would have a portfolio that would’ve made you money. Graham lived a life of sharing. He may have had more money hoarding, but lived happier because of it. The money’s just a figure in the paper, perhaps he would’ve died with 86 million instead of 42 million, but it doesn’t really matter. 90% of the people that took his class ended up doing something else.
At age 11 I started investing, purchasing three shares of Cities Service Preferred. I had read every book on investing in the Omaha library. I was really into charting and technical analysis. I loved it, but didn’t make any money from it. At 19 I read Graham’s “The Intelligent Investor” and it changed my world. Did Ben lose because I read his book? Maybe we competed and he made less money, but it didn’t matter to Graham.
The philosophy either takes immediately or it doesn’t at all. The reason gets down to temperament. People want to make money fast, but it doesn’t happen that way. Graham’s philosophy doesn’t promise enough for many people. You don’t know when it will happen, but you just wait for the fat pitches within your circle of competence. It’s not as exciting as guessing whether the stock price will go up the next day. Most investors in internet companies didn’t know the market cap. They were buying because they thought the stock would move, but if you asked them to write “I would buy XYZ company for $6 billion because”, they wouldn’t get halfway through the sentence. It’s the classic tortoise versus hare, bound to work over time. Charlie and I have educated competitors. Most don’t compete with us, though. It’s fine, we have more than enough money.
- A living example. Is there any example for technical analysis?
在股市的大家庭里，有着各门各派，
ReplyDelete有技术派、基本派、随机派...
在佛教的大家庭里，也有各宗各系，
有净土宗、禅宗、密宗...
那是因为人的根性不同、性格不一，
需要不同的方法来处理问题。
^.^ 何必老是苦苦强求他人认同自
己的看法呢？呵...
hi lokgp,
ReplyDeletei guess you want ppl to see, think & explore your sharing and points, it's not as simple to 认同看法 ...
coz you said b4: shoot me!
hopefully i don't misunderstanding you! btw, what you aim for?
personally, i enjoy & love your sharing & mindset so much as it opens mine! i TQ so much ... :-)
Dearest all,
ReplyDeleteThere is an exact science in school. There is an exact method for scoring science subjects, mathematics. These were scientific subject. Started with an assumption, continued with observation, and then ended with conclusion.
That is what we come to know as scientific studies and methodogy.
There is always fixed solutions or fixed method to solving the problem. You can not add a figure using logarithm. But we can use matrix, multiplication, division even if they are harder. But the answer will always be correct.
Artistic studies are subjective and have no fixed forms. But in some ways, there are rules and boundaries in application of art methods where you can copy and replicate the results. You can still produce a reasonable artistic result by following fixed methods.
Fixed methods are the scientific study of art.
We can be sure that using a fixed method for art will contain no individual free form and will not be outstanding.
But how many people around you are outstanding at art?
I know am terrible at art.
The general person will be much better off applying scientific methods or fixed steps copying the artwork and produce a generally good results.
So, is investing an art or science?
Either way, I humbly think that a scientific method be it a study or a scientific copy of the artistic methods are the best way to generate a reasonable return on capital.
Most likely not an outstanding performance but it will be a reasonably good performance.
I agree with BC. No arguments intended. Just for constructive discussion.
- Lok
以年轻人而言，Lok 算是难得的了，
ReplyDelete见解独特，肯动脑筋，爱啃书...
目前的他，需要的只是成长而已！
我常跟他老爸说：你的儿子实在比你
--- 出色太多！^.^
（ 我和lok 老爸都十多年老友了...）
Bc,
ReplyDeleteThanks for the compliments.
But until I am capable of performing the results, these are all assumptions.
Looking at my terrible track record, I think your valuation on me so far is incorrect.
- Lok