Warren buffet investment guru (ICFAI center for management research)

Essay by pastnieceUniversity, Bachelor'sB+, September 2007

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Investments and BankingCase 1: Warren Buffett. In your own words, how would you briefly explain the Ben Graham's theory of investing?Benjamin Graham (BG) believed that investment in most intelligent when it is most businesslike, he believed just in numbers and margins and heavy relied on quantitative analysis of financial statements. He often referred as a passive investor -he looked for companies with strong balance sheets and no or little dept, high profit margins. He invested cautiously, looked for value stocks, invested for the long term and was more on the safe side meaning no unnecessary risks.

BG also introduced, developed and influenced Buffett`s intellectual basics of investment and teaches methodology how to identify good long term investments.

BG believed that emotions mislead and impatience can force to make premature decisions. BG always looked from calm side on market fluctuation processes to find a right moment to interfere.

. In your own words, how would you briefly explain the Philip A.

Fisher's theory of investing?Philip Arthur Fisher (PAF) was more active type investor who relied on quantitative analysis was ready to take bigger risks doing research, evaluation and after purchasing stocks for companies with potentially good future growth in combination with good management. As well as BG he relied on conservative investment principles looking for high profit margins, high return on capital etc., but differing from BG PAF believed that it is worth to spend more time, interest, and possibly seek for more specialized knowledge to find out exceptional buys in the market. PAF strategy was to acquire stocks when they are at historically low prices. He was more as a person of the future, a prudent one.

. Why did Mr. Buffett avoid investing in technology stocks during the dotcom boom in the late 1990s?Warren Edward Buffett...