Warren Buffett - The Greatest Investor Ever?

Recently, after posting a gain of over $20bn (14%), Buffett called his performance for the year "disappointing". He has one of the greatest track records in history and an approach that is dictated by fundamental value investing.

Admittedly a lot of his great plays recently have been helped out by government bailouts / policy but in my opinion he still has a track record that can only really be rivaled by someone like Soros; these guys have made money in every single environment and are clearly not just leveraging beta.

Thoughts?

Comments (29)

Mar 6, 2013

I think its really difficult to measure his skill as an investor, he simply has such a powerful influence over the markets; if he buys something, it'll go up. This being said, he does identify some really good investments, but his legacy is his own catalyst. It is also difficult because during his early days, he participated in the markets during an overextended bull market.

Mar 6, 2013

I am not disagreeing that he now has a very large sway (which he earned himself) over the markets (in the short term). However, he wasn't born with this. He had to get there. How did he get there? By being really successful and being the CEO one of the largest companies in the world. How did he become really successful and the CEO of a really large company? He started with a really small money and compounded wealth at a faster rate than just about anyone over the course of 40+ years. One would have to reeeeally stretch the imagination and say this is based on some long bull market (65-82 were flat in the market...as was 1999 to today).

Mar 6, 2013

Soros doesn't come close, over the past decade he has been annualizing at about 10%. There is one manager that would eclipse WB in terms of long term track record- Jim Simons.

Mar 6, 2013
Macro Arbitrage:

Soros doesn't come close, over the past decade he has been annualizing at about 10%. There is one manager that would eclipse WB in terms of long term track record- Jim Simons.

Simons/Ren Tech focus primarily on arbitrage strats as I understand it. Considering they only hire the brightest quants AFTER they proved they're the brightest (extensive research after earning Ph.D) its easy to see why. His firm charges insanse fees though. I think like 5/40 vs the average 2/20. Their returns precession was like 35% gross annualized.

http://www.marketfolly.com/2009/04/jim-simons-rena...

There closer to quality market makers than investors if you ask me. Not saying it doesn't take skills but different skillset.

Edit: I did a little more research & noticed they do hold longer positions but still not sure how long or their exact methods.

Mar 6, 2013
hopingtobreakin:
Macro Arbitrage:

Soros doesn't come close, over the past decade he has been annualizing at about 10%. There is one manager that would eclipse WB in terms of long term track record- Jim Simons.

Simons/Ren Tech focus primarily on arbitrage strats as I understand it. Considering they only hire the brightest quants AFTER they proved they're the brightest (extensive research after earning Ph.D) its easy to see why. His firm charges insanse fees though. I think like 5/40 vs the average 2/20. Their returns precession was like 35% gross annualized.

http://www.marketfolly.com/2009/04/jim-simons-rena...

There closer to quality market makers than investors if you ask me. Not saying it doesn't take skills but different skillset.

Edit: I did a little more research & noticed they do hold longer positions but still not sure how long or their exact methods.

Simons was a stud, but is now retired. The sick returns that you are talking about belong to the Medallion fund, which is employee cash only unfortunately.

Mar 6, 2013
hopingtobreakin:
Macro Arbitrage:

Soros doesn't come close, over the past decade he has been annualizing at about 10%. There is one manager that would eclipse WB in terms of long term track record- Jim Simons.

Simons/Ren Tech focus primarily on arbitrage strats as I understand it. Considering they only hire the brightest quants AFTER they proved they're the brightest (extensive research after earning Ph.D) its easy to see why. His firm charges insanse fees though. I think like 5/40 vs the average 2/20. Their returns precession was like 35% gross annualized.

http://www.marketfolly.com/2009/04/jim-simons-rena...

There closer to quality market makers than investors if you ask me. Not saying it doesn't take skills but different skillset.

Edit: I did a little more research & noticed they do hold longer positions but still not sure how long or their exact methods.

The truth of the matter is anyone who is aware of RenTech's strategy is yet to publically speak about it. While it is known that they trade in a high frequency capacity, they're not electronic market makers.

Mar 6, 2013

Can't people find someone new to circle jerk over.

Buffets good, duh. Read his letters, learn something. Otherwise, realize there are many strategies, best to learn how to dominate your strategy niche before its overcrowded, exactly how he still does it. Not too many people with his size of money to crowd his investments over his time horizon.

Mar 6, 2013

I don't care who has better percentage gains. He has the most money of any investor. Who cares if you are the best investor if you are worth far more than anyone else. I'm biased because I know him personally but still. Jim simons maybe gives him a run but after that there's just no one else.

Mar 6, 2013
kyleyboy:

I don't care who has better percentage gains. He has the most money of any investor. Who cares if you are the best investor if you are worth far more than anyone else. I'm biased because I know him personally but still. Jim simons maybe gives him a run but after that there's just no one else.

What about Ray Dalio? I'm heavily biased here.

Mar 6, 2013
kyleyboy:

I don't care who has better percentage gains. He has the most money of any investor. Who cares if you are the best investor if you are worth far more than anyone else. I'm biased because I know him personally but still. Jim simons maybe gives him a run but after that there's just no one else.

Fine, I'll bite. You know Buffet personally?

"My dear, descended from the apes! Let us hope it is not true, but if it is, let us pray that it will not become generally known."

Mar 6, 2013
Illuminate:
kyleyboy:

I don't care who has better percentage gains. He has the most money of any investor. Who cares if you are the best investor if you are worth far more than anyone else. I'm biased because I know him personally but still. Jim simons maybe gives him a run but after that there's just no one else.

Fine, I'll bite. You know Buffet personally?

Indeed, I can't go into much detail but we went out to lunch, drove around in his car and went to this country club that I don't know how it is called a country club because it was just a house that held banquets. This was all a few years ago down in Omaha. He was an awesome guy. He is exactly like you'd expect. He also drives really bad. I mean really bad. No turn signals, no stop signs. His car is dirty and he has crap all over the floor. He drank like 4 cherry cokes while we were chilling. It's funny, I could tell Coke really meant something to him. It is something he really cares about. I still keep in touch with him from time to time. He recommended a few books to me and one really obscure one that I had not heard about before. I can't remember it and it sucks that I forgot it. I'm sure its out there somewhere. We talked about short selling and he gave me a lot of advice on that side of the game. We mostly talked about redeeming qualities in people and how he believes IQ is only necessary to a point. Honesty got him where he was he says.
Very good guy.
Has life by the balls

Mar 6, 2013
kyleyboy:

I don't care who has better percentage gains. He has the most money of any investor. Who cares if you are the best investor if you are worth far more than anyone else. I'm biased because I know him personally but still. Jim simons maybe gives him a run but after that there's just no one else.

I'm not doubting Buffett's ability, but Jim Simons doesn't have that sweet insurance float either.

Mar 6, 2013
DBCooper:
kyleyboy:

I don't care who has better percentage gains. He has the most money of any investor. Who cares if you are the best investor if you are worth far more than anyone else. I'm biased because I know him personally but still. Jim simons maybe gives him a run but after that there's just no one else.

I'm not doubting Buffett's ability, but Jim Simons doesn't have that sweet insurance float either.

Well its Jim Simons's fault he doesn't have that sweet insurance float. I'm kidding but if you can get yourself a competitive advantage...Why not??

Mar 7, 2013

Soros & Simons. I think it would be more productive to break down rankings by strategy.

Back in my college days, it was reading Soros that turned my investing game around. Partly biased.

Mar 7, 2013

The whole 'knowing Warren personally' thing is epic

Mar 7, 2013

Regarding OP's 'not just leveraging beta' comment - not sure if the paper below has been posted before:

http://www.econ.yale.edu/~af227/pdf/Buffett's%20Alpha%20-%20Frazzini,%20Kabiller%20and%20Pedersen.pdf

Of course finding a lack of significance doesn't prove insignificance, and I haven't poked for the holes in the empirics, but it's an interesting analysis nonetheless.

What's for certain is he's a really sharp guy and any investor will learn many good things from his letters and approach to fundamental research.

if you like it then you shoulda put a banana on it

Mar 7, 2013

And he seems nice too. I wish he was my great uncle or something. I imagine he would be really fun at Thanksgiving dinner (Tell us another story Uncle Warren!) esp after a few glasses of wine.

if you like it then you shoulda put a banana on it

Mar 7, 2013

I'd have to say Simons out of the fact that he and most everyone at his firm is likely near genius level. I just personally admire people who has the brains to give fuck all because they could literally do anything.

And I'm sure Buffet is a cool guy, just get annoyed by his fan club. Everyone and anyone knows who Buffet is, Simons is less recognized.

Mar 9, 2013

Jim Simons, the hipster investor pick.

lol @ buffet having shit all over the floor of his car.

Mar 11, 2013

Benjamin Graham is the Godfather of value investing. Maintained 17% annual return until its termination.

Stay Strong!

Mar 7, 2013

Hard to put the label 'greatest investor ever' on any one guy. I like to think of them the way that I'd rank comedians. For every guy who's better or more popular than the guys before him, he'll tell you he couldn't have gotten there without 40 other comedians to piggyback off of and mold the ideas of. There's certain guys a ton of amazing comedians will have in common as influences and those are the ones who are widely regarded as the best... your George Carlins, Andy Kaufmans, Richard Pryors, Bill Hicks guys. It's impossible to put your finger on any one of those guys and just say "this one is the best" because they all have such distinct styles, but you can narrow the list down a bit. Other than the obvious guys like Graham, Buffet, Soros (I personally don't think he's a great investor), whoever... I think it's disappointing that so few younger investors know/appreciate the guys who were really big influencers but never super high-profile, e.g. Max Heine, Irving Kahn, Bill Ruane, Marty Whitman.

Mar 6, 2013
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Jun 12, 2013
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The HBS guys have MAD SWAGGER. They frequently wear their class jackets to boston bars, strutting and acting like they own the joint. They just ooze success, confidence, swagger, basically attributes of alpha males.

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