Read 500 Pages Per Day
Investors are constantly looking for nuggets of wisdom from the Oracle of Omaha, Warren Buffett, so this tidbit on Omaha.com caught our eye.From Omaha.com:
It's just one quote from Buffett. He was at a 165 person Columbia University investing class, and one of the students asked him how to prepare for a career in investing.
...Buffett thought for a few seconds and then reached for the stack of reports, trade publications and other papers he had brought with him.
“Read 500 pages like this every day,” said Buffett, or words to that effect. “That's how knowledge works. It builds up, like compound interest. All of you can do it, but I guarantee not many of you will do it.
Does anyone here actually come close to that mark? I kind of feel guilty for going out on a Saturday night after reading that. I knew Buffet was an avid reader, but 500 pages per day is insane. I don't even think I could do that if reading was my full-time job.
I'd sort of like to do a study on investment managers to compare investment returns based on how much PM's read each day. I'm guessing he's not the only investment manager who likes to read.
http://www.businessinsider.com/buffetts-advice-to-an-investing-class-20…
Well, the PM I talked to at a fund I worked at typically read for 1.5 hours on his morning commute, 1.5 hours home and then spent most of the 11 hours he was at work reading and on calls.
If the average pages read per hour for someone is 40-100 I can easily see how 500 pages is attainable. I do alot of research for a hobby I'm interested (will keep private for anonymity) and I know I get around 250 pages per day despite everything else I do.
Buffet plays Bridge for 3-4 hours/day and reads the rest of the time. So yeah, I think that's an attainable number. Nonetheless, that's a lot of reading.
I don't know if it was the lad asking the question who actually started doing that (reading 500 pages per day), but I read a story somewhere that one guy in the audience followed Buffet's advise. Personally, I think reading 500 pages sounds very, very challenging. If we imagine that you read one page per minute, which is really fast when reading non-technical material, you would have to read for 8 hours and 20 minutes per day, excluding any breaks.
I would be impressed if someone managed to read a hundred pages a day, since that would mean you read 36 500 pages a year, or more than 1 million pages during 30 years.
"“Read 500 pages like this every day,” said Buffett, or words to that effect. “That's how knowledge works. It builds up, like compound interest. All of you can do it, but I guarantee not many of you will do it.”
Remarkably, Combs began doing just that, keeping track of how many pages and what he read each day. Eventually finding and reading productive material became second nature, a habit. As he began his investing career, he would read even more, hitting 600, 750, even 1,000 pages a day."
http://www.omaha.com/article/20130428/MONEY/704289987
That Combs guy seems to be doing well for himself. ;)
Plowing through research reports can go pretty fast consider a lot can be charts, tables, etc. and bullet pointed text.
On another note, would highly suggest to folks starting out to read business descriptions in company 10-Ks. Those things are goldmines, not just on the companies themselves, but who they consider compeitiors and general industry dynamics. Also MD&As are great reading. If you want to step up your game get into the accounting treatments, these shift a lot company to company and many people do not take that into account when comping.
For me personally, my prefered reading is definitely company filings, fiction is worthless (but not really, just reread Ender's Game for old times sake).
500 is pretty easy when you think about everything you read as being on "pages." A research report with some charts and maybe only 75% text... are those pages? Are online news articles pages? If that's the case then I'd say you can surpass that over the course of a work-day pretty easily if you are someone in research who isn't crunching numbers for most of the day.
A much harder benchmark would be hitting 500 physical pages, as in filings or something along those lines. I'd still say certain days I can hit that, but more realistic would be like 200-250 pages per day on average.
and 10k's on the screen for now...I'm pretty sure I'd get fired for printing that many papers. To do it at home is $15 per 10k just in paper costs
Yep.
500 pages a day sounds tough, though. I probably plow through 500 a week (including pics, charts, graphs, tables etc)- maybe 10-20 pages end up being truly useful in some way to my work, with the balance being useless but somewhat interesting. I usually have stacks of research papers a couple of inches high on my credenza.
I think the important point Warren Buffett was trying to convey was that - if you want to be truly successful (in anything, not just value investing), you have to be a student of your industry.
This^
Anyone else hate reading things on a computer? Much much prefer reading something on paper.
Kindle?
I always hated reading stuff on a computer screen (unless it was Internet content which is designed and formatted for that) until I discovered the Kindle Cloud Reader. If you have to read a book online, the Cloud Reader is a pretty nice experience.
I'm with you on this. Kindle/Nook/etc doesn't have the same feel.
Anyone speed read? I have been practicing it for awhile and have gotten decent at it, if you were able to do it and keep your comprehension level above 50%, then 500 pages a day would be no problem. The average person reads 200-250 per minute with retention being 65% (don't quote me on that tho) and I think the world record is something like 1,700 wpm.
I have tried it. It's much easier when reading light material, but when you are going over 10Ks and 8Ks, 500 pages a day is damn near impossible.
500 pages a day is insane. If its something like Harry Potter, fine, but Buffett was talking about trade publications with a lot of raw data that needs to processed and constantly integrated with current knowledge. I'm lucky I get through the Economist every week.
What would be the equivalent for quantitative investors since math is much more dense: 50 pages a day?
I find that extremely hard to believe. 500 pages a day is insane. If true that has to be skimming most of the text and only reading certain parts. There is no way someone can read 500 pages thoroughly of 10k / research reports at that clip. That is literally the equivalent of reading entire text books in a day. That is either super human or just complete bs. Personally, I think it is that latter.
10K's are especially easy for companies that have a template for each release - you know exactly what paragraphs are important/not after reading a few periods worth.
As far as 500/day - I managed about 10 pages/hour going through the CFA schwesernotes. 500/day is a long ways off (of course CFA study is a bit different, but still...)
You can do it if you prefer to do nothing else really.
Does reading online articles/publications count as "pages"? I typically will spend an 1 - 1.5 hours in the morning reading the news from a plethora of sources, so does getting through 1-3 page articles every 1-5 minutes count?
Also, I have no idea how people can read material with substance through a screen. I always need to print out 10ks and other reports in order to get through them.
Pretty sure anyone that would actually read a 10K on a computer is either retarded or an intern or both
I admit I read 10-k's on screens at the moment and absolutely hate it. I think people at my firm would hate me if I kept on printing hundreds of pages to take an initial glance at a company though. My desk would literally be stacks of paper if I did that.
Like most people are saying, 500 pages a day is a spectacular amount. However, as previously mentioned, speed reading can significantly increase how much you can read/process in a day.
From personal experience, after learning how to speed read and then actually doing it(the hardest part of the process), I know I can read about 200-250 pages in roughly 3 hours give or take. However, the subject is not super technical. My reading speed decreases drastically if I were to read something about Econometrics or some in depth theory.
To summarize, I think Buffet is just saying reading a lot is important to increase your knowledge. As other people have mentioned, he is most likely skimming some parts of the reports.
Lastly, I've noticed whenever I read material that is all on the same subject, it is easier to skim/speed read but retain a large amount of info since a lot of info repeats itself or follows similar patterns. If I were to read a history book one hour, then a accounting methods book the next, and then finish with a statistics book I would retain less overall I noticed. If you were just plowing through 10Ks, after awhile your brain gets better at it.
There's also this:
"Read 500 pages like this every day,” said Buffett, or words to that effect."
We don't know that he actually said 500, or just grabbed a stack of paper and said "read this every day"
I can read around 800 to 850 wpm with 50% retention. However 500 pages a day is easy if the font is 50 or 60. All how you look at it.
I think the vast majority of people here are focusing on the wrong thing when focusing on the 500 pages per day. If you are the one rare individual who wants to live like Warren Buffet, then sure you should read that much. But that's similar to a world class body builder saying you have work out 3-4 hours / day.
It's not a one or the other, it's works on a continuum. The more you read constantly and consistently the better you will become at it and the more your knowledge will compound. That's true whether you read 50-100 pages a day or 500+ pages a day and obviously the more you do the better you become. The same as working out. Just start and do it consistently and then work your way up to more and more as you get better at it. Take a slow and steady approach and build up over time.
Kind of sounds like CFA prep...except this is for the rest of your life.
you are not expected to read 500 pages right off the bat, honestly I believe that you need to build up to it.
I can read 500 pages of technical material in 7-8 hours only because I have been reading for a long time.
I realized the importance of compound knowledge far before I read it here (you don't have to be smart to know that, just a little aware). When I first started I could only read like 80 pages of technical material.. fast forward 3 years later and here we are.
Reading definitely has made me a better investor/trader, it is the main reason why I have quite a sum of money at age 20 and will likely continue to as I learn something new everyday.
And to be honest the hardest thing is realizing you need to read a 500 page book twice or three times to really absorb the message.... but in the end it pays off.. big time :).
(and that's why buffet says not everyone can do it, and not because he is trying to be a dick).
That said anyone can do this =)
i love printing out shit to read on the train and have people do a double take because im dressed in shorts and a polo
no one is reading 500 pages a day and comprehending it, not even kids at Y law. The first year of law school i read all day every day and didnt even come close to that mark. Maybe you could do it if you were reading harry potter or some bs.
And therein lies why most people don't make it in this industry. To the people who know what WB means when he says to always be reading, you guys know that for nerds like us... a utilities company's annual report IS our Harry Potter. Holy shit I got wood just thinking about reading an AWK quarterly... I'll be right back.
can we clarify reading vs. skimming. I interpret reading to be word for word, sentence for sentence, paragraph for paragraph, as if you are reading a novel. Using that interpretation there is no way you can read 500 pages a day of all that financial stuff.
However, if you interpret reading to mean skimming through most stuff and really zeroing in on important parts that sure I think 500 pages a day is totally doable.
This whole thread is kinda pointless until everyone is using the same definition.
So for those such as BH claiming its possible, can you define how you interpret reading in this context.
I have a feeling some of the info he's reading is being glanced over. Additionally, he's been doing this for 60 years, I'm sure he knows what he's looking for when he goes through a 10-K
You completely missed my point. I wasn't referring to interest level. Sure, I am sure many if not most people on this site would find a company's annual report as interesting, if not much more interesting, as Harry Potter. I was commenting that it is easier to breeze through a novel at a middle-school reading level than it is to read a report with actual substance. But maybe I'm wrong, and you, WB, and other intellectual powerhouses can breeze through, fully comprehend, and retain 500 pages of substantive writings in a day.
I am in no way arguing that you shouldn't always be reading, I am just saying in the literal sense that 500 pages in a day is more than excessive. That's also an absolute joke to think that reading this amount of material daily is some sort of prerequisite to "make it in this industry." In fact, attempting to try to read 500 pages everyday would be extremely counterproductive.
Yeah that's fair, we were talking about two different things, apologies.
And like I said, and someone above me said, if you only want to count "pages" as printed out pages of dense company filings, then I doubt many people are doing 500 of those DAILY. I'd say on that basis I do 200 to 250 give or take another 25-50 depending on what company I happen to be reading about that day. But if you also count news articles online (but still reading them all, not just headlines), research memos, reports, etc. then I think 500 a day isn't impossible. If weekends counted as extra credit I'd say I can average 500/day on that basis for a 5 day work week. Look at it this way: an average K is at least 150 pages, a Q is another 60-70, a few transcripts at 20 pages each and some research reports at 10-15 and you've gotten yourself to 300-350 before doing the other stuff that you'd have to count to make 500 reasonable, so I can see where an old fuck like WB who has nothing better to do can hit 500 regularly...
And I don't think there's a real gauge of what should and shouldn't be considered "excessive reading" considering that's really all this job is in certain strategies, but yeah it could definitely be a waste of time at a certain point if you haven't done the other stuff you should be doing as diligence to make that reading actually worthwhile.
If you've read every comment up to mine, you've read the equivalent of 500 pages about reading 500 pages.
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