Warren Buffett is a living legend. But what fascinates investors so much about the American star investor who still does business with a handshake?
• The star investor as a role model for investors
• Timeless investment principles
• “Woodstock of the Capitalists”: Shareholder meetings as a personal connection
The personality of Warren Buffett is the focus of the company Berkshire Hathaway. “He’s a brilliant oaf from the prairie and is considered the personified counterpart to Wall Street,” the Süddeutsche Zeitung describes the “Oracle of Omaha”. With his refusal to follow easy money and his way of working, he himself contributes significantly to this myth. Buffett prefers to make decisions alone, and democracy is not required when it comes to investments.
Warren Buffett speaks directly to employees and investors with his upbeat attitude and direct, understandable advice. He trusts his employees, in line with his motto that he buys companies and does not want to manage them. His employee motivation is also based on this trust: inspiring enthusiasm for the vision of the company and rewarding good work. The investor also repeatedly emphasizes how important lifelong learning is, he himself is constantly learning. He sees mistakes as part of the process, you don’t have to apologize for mistakes, after all he makes them and learns from them.
The lifestyle
The star investor lives modesty, and that with a three-digit billion dollar fortune. Buffett’s physical appearance and lifestyle set him apart from Wall Street brokers – and he can’t stress this enough. The frequently cited, ill-fitting suits, the middle-class car, the house in which he has lived with his family since 1958, and the nondescript rented office space have become his trademarks. Extravagances are rather rare and are not hung on the big bell.
The investment style
Long-term is the guideline for investments. Warren Buffett only picks companies with a stable business model and stable revenue growth at a time when the companies are undervalued. This requires close and continuous monitoring of the market by Buffett himself, as he repeatedly emphasized in the shareholder letter.
According to the authors of the Buffett management compass “The Power of Honesty”, personal contact is another sticking point for the investor. The “chemistry” has to be right: Buffett invests in companies, but leaves leadership to individual managers.
Timeless ground rules
He is looking for companies whose business models he understands and for whose long-term development he has a feeling, he said a few years ago in Frankfurt. In his letters to shareholders, he repeatedly emphasizes that he does not buy shares, but shares in companies, be they Coca-Cola, Apple or a chocolate factory. These companies have to be excellently positioned in terms of profitability and staffing and at the same time undervalued. Buffet repeatedly recommends concentrating on a few investments and advises against impulsive purchases that do not meet the investment criteria.
Shareholder meetings and shareholder letters as a personal connection
The shareholders of Berkshire Hathaway show an almost cultic reverence for Warren Buffett and flock to the annual shareholders’ meetings, the “Woodstock of the capitalists” as they are often called in the media. According to media reports, the three-day annual general meetings are huge show events that hardly any small investor anywhere in the world would want to miss. It is here in particular that the investment legend is approachable and can be reached and experienced by investors.
In his annual letters to shareholders, Buffett always puts the (small) investor at the center of his work, because he invested his money in Berkshire and it is now Buffett’s responsibility to deal with it.
All in all, everything at Berkshire Hathaway focuses on Buffett’s personality, his decisions, and his leadership skills — and that hasn’t changed in the last 50 years. A structure that leaves a big vacuum when Buffett is no longer in the executive chair.
Editorial office finanzen.net
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