If any trader or investor does not know who Warren Buffet is then he is surely living under a rock or is pretending to be an investor. Warren Buffett is the man who revolutionized the art of investment and has left a long lasting legacy for us that may never fade.
Buffett is called the “Wizard of Omaha”, “Sage of Omaha” and “Oracle of Omaha” because of his investing philosophies and his ability to recognize the potential of a company or business for the future terms. He holds a degree of Bachelor of Science degree in Business Administration from the University of Nebraska-Lincoln and a Master of Science in Economics from Columbia Business School.
His journey towards becoming a Millionaire:
Warren Buffett started investing in stocks at an early age and was always lured towards investments. He did several jobs as a teen, from buying stocks from his pocket money to selling foodstuff from door to door. He later did jobs at Buffett-Falk & Co., Omaha as an investment salesman from 1951–54, at Graham-Newman Corp., New York as a securities analyst from 1954 to 1956 and Later at Benjamin Graham's Partnership.
By 1956, Buffett's personal savings were over $174,000 and he started Buffett Partnership Ltd., an investment partnership in Omaha. By 1960, Buffett had seven partnerships operating: Buffett Associates, Buffett Fund, Dacee, Emdee, Glenoff, Mo-Buff and Underwood.
In 1962, Buffett became a millionaire because of his partnerships, which in January 1962 had an excess of $7,178,500, of which over $1,025,000 belonged to Buffett. Buffett merged all of the partnerships into one. He invested in and eventually took control of a textile manufacturing firm, Berkshire Hathaway. Buffett's partnerships began purchasing shares at $7.60 per share. In 1965, when Buffett's partnerships began purchasing Berkshire aggressively, they paid $14.86 per share while the company had working capital of $19 per share. This did not include the value of fixed assets (factory and equipment). Buffett took control of Berkshire Hathaway at the board meeting and named a new president, Ken Chace, to run the company.
His journey towards becoming a Billionaire:
On paper Warren Buffett first became a billionaire in 1990 when Berkshire Hathaway started selling Class A shares. The share price closed at $7,175 a share. He acquired General Re(Gen Re) for stock in 1998 and in 2002 he involved with maurice R.Greenberg at AIG, with General Re providing reinsurance, adding further business under his belt.
His Involvement in Currencies:
Buffett entered in $11 billion worth of forward contracts in 2002 buying US Dollars against other currencies in 2002 and by April 2006 he had netted over $2 billion in these contracts.
Investing in China:
Warren Buffett invested in PetroChina but soon sold all his stake in it due to its connection with the Sudanese civil war preventing him billions of dollars he would have lost had he held on to the company as the oil prices dropped sharply in 2008.
In October 2008, Buffett invested in Automobile business by buying a 10% stake in automobile make BYD Company for $230 million and in less than 1 year took out a 500% return from this investment.
Charity and Philanthropy:
In june 2006, Warren Buffett announced that he will give 85% of his holdings in berkshire hathaway in 5 foundations the largest of which went to the Bill And Melinda Gates Foundation.
In 1998, Warren Buffett once said about his wealth:
“ I don't have a problem with guilt about money. The way I see it is that my money represents an enormous number of claim checks on society. It's like I have these little pieces of paper that I can turn into consumption. If I wanted to, I could hire 10,000 people to do nothing but paint my picture every day for the rest of my life. And the GDP would go up. But the utility of the product would be zilch, and I would be keeping those 10,000 people from doing AIDS research, or teaching, or nursing. I don't do that though. I don't use very many of those claim checks. There's nothing material I want very much. And I'm going to give virtually all of those claim checks to charity when my wife and I die“.
He also opposes the idea of transferring fortunes from one generation to the next. he once said:
“I want to give my kids just enough so that they would feel that they could do anything, but not so much that they would feel like doing nothing”.
Personal Life:
He is married to Susan Buffett and has three children. He is a very good player of bridge and plays it 12 hours a week playing it. He reads five newspapers every week starting with Omaha World Herald which he bought in 2011. He has no computer at his desk and does not carry any cell phone (something any investor can not live without these days). He still lives in the same house he bought in 1958 and drives his Cadillac DTS on his own.
An Inspiration for All:
There is no denying that not only Warren Buffett's investments can be an inspiration for all the investors out there but also to the ones that are not even into investing. He has shown us all there it's possible to achieve a lot of big goals if proper money management and planning is done. And the most of all the ability to stay patient and making the decisions wisely without any rush.
Bill Gates once told in an interview that the biggest thing he learnt from Warren Buffett was saying “NO” when there are doubts and not taking uncalculated risk.
