Buffett Letter: 1962 semi-annual 1

1962

Semi-annual 1
  • Lot of details on operational aspects of the partnership are mentioned. These semi-annual letters in my opinion are not timely, some are written in July and some the next year in January. I can overlook this for the sheer quality of ideas which Warren Buffett shares.
  • The Dow was down this year till the time the letter was written. Buffett's investment in Dempster has been paying off with prompt sale of its assets. I think in the early years Buffett focused a lot on such opportunities wherein he could buy a company cheap strip its assets of and sell them at fair value and make money. Dempster is just one case.
  • Though the index was in red the partnership was in green with close to 22.3% point advantage. 40% of its overall gain was because of only Dempster.
  • Buffett importantly highlights that such results are distinctly abnormal and will recur infrequently, if at all.
  • Again he reemphasizes that in a good year for Dow he will look bad by saying 'If the Dow had continued to soar, we would have been low man on the totem pole.'
  • He ends the letter reiterating that such superior performance to the Dow will be very limited.

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