Life Of Warren Buffett
If you want to master the markets you should learn from the pros. Out of all the pros there is no better person to learn from than master stock investor Warren Buffett. We all know Warren Buffett made billions through stock investing and his Berkshire Hathaway holdings, yet few know the life of Warren Buffett and how he came to master the markets.
Born Warren Edward Buffett on August 30, 1930 to his father Howard, a stockbroker-turned-Congressman. Warren displayed an amazing aptitude for both money and business at a very early age.
At the early age of six Warren was already amassing his fortune. Buffett started by purchasing 6-packs of Coca Cola from his grandfather’s grocery store for twenty five cents and resold each of the bottles for a nickel, pocketing a five cent profit. While other children were playing ball Warren Buffett was making money.
Than at 11, Warren Buffett jumps into the world of high finance. It was then he bought his first stocks, three shares of Cities Service Preferred at $38 per share. Shortly after purchase, it fell to $27 per share. Then like most investors, he gladly got out after the stock rebounded to $40. This was a mistake he soon came to regret. Not long after the stock shot up to $200. That experience taught him one of his first lessons in stock investing, patience is a virtue.
At the age of $13, Warren Buffett filed is first tax return, claiming a $35 deduction for a bicycle that he used as a paperboy.
Upon graduation from high school at 17 in 1947, Warren Buffett wanted to run his own business rather than go to college. He had saved $5,000 (worth about $50,000 in today’s money) from his newspaper route. But upon the insistence of his father he must attend college.
After attending Wharton Business School and the University of Nebraska-Lincoln, Warren Buffett eventually ended up at Columbia. It was here at Columbia the young Mr. Buffett found a mentor in Ben Graham who ended up changing the life of Warren Buffett.
Ben taught at Columbia and soon crossed paths with young Warren. Ben Graham came up with the principle of “intrinsic” business value – a measure of a business’s true worth that was completely and totally independent of the stock price. Using intrinsic value, investors could decide what a company was worth and make investment decisions accordingly. His subsequent book, The Intelligent Investor, which Warren celebrates as “the greatest book on investing ever written”, introduced the world to Mr. Market – the best investment analogy in history. Ben Graham became an idyllic figure to the twenty-one year old Warren Buffett.
In 1985, Warren Buffett took over the textile firm Berkshire Hathaway. Today the Berkshire Hathaway holdings include insurance (GEICO, General Re), jewelry (Borsheim’s), utilities (MidAmerican Energy), food (Dairy Queen, See’s Candies).