Investment icon Charlie Munger, vice president of Berkshire Hathaway (BRK-B, BRK-A) and Warren Buffett’s longtime business partner, says his type of value investment “will never go out of style”.
“Because investing in value – the way I see it – is always wanting to get more value than you pay when you buy a stock, and that approach never goes out of style,” said Munger on Wednesday at the Annual Shareholders Meeting at the Daily Journal Corporation (DJCO), where he serves as chairman.
According to Munger, some think that investing in value means chasing companies with lots of money, but they run a terrible business.
“[I] do not define this as investment in value, “he added.” I think that every good investment is an investment in value. Some people look for values in strong companies and others look for values in weak companies. But every value investor tries to get more value than he pays. “
‘Diworsification’
Munger noted that, in the area of wealth management, “many people think that if they have 100 shares, they are investing more professionally than if they had four or five”.
“I think this is crazy. Absolute insanity, ”said Munger.
“I think it’s much easier to find five than 100,” argued the 97-year-old investor. “I think the people who defend all this diversification, by the way, call it ‘diorsification’, which I copied from someone. And I am much more comfortable with two or three actions that I think I know something about and where I think I have an advantage.”
Later in the meeting, when asked how he advises universities and charities to manage his donations, Munger shared that a charity donation where he has had “some influence for a long time” has a “group of renowned financiers in all branches of society. wealth management is on its plate. According to Munger, this institution has two assets in its donation account – a large stake in Li Lu’s limited liability company and a Vanguard index fund.
“And as a result of holding these two positions, we have a much lower cost than anyone else and make more money than just about everyone,” he said. “So now you know what I do in charities. By the way, this is not the normal outcome in America. The wealth management industry has a crisis on its hands. They really need the world to continue as it is, and this is not necessarily right for their customers. “
The Daily Journal’s stock closed up 1.4%, or $ 4.70, ending Wednesday at $ 351.
Julia La Roche is a correspondent for Yahoo Finance. follow her Twitter.
Read more at the Diary Meeting: