Saturday, November 18, 2006

Trade Like Warren Buffett - Book Review

Trade Like Warren Buffett (Wiley Trading)

What Is It About?

Unlike other books that focus on Warren Buffett's buy and hold investment style, this book takes a look at other stock market strategies Buffett uses. The author does this in acomprehensivee, yet easy to read format. The best description of this book is that it takes many concepts discussed in Joel Greenblatt's You Can Be a Stock Market Genius and examines how Buffett has for many years applied similar techniques.

What Did I Get Out Of It As A New Investor?

For the uninitiated there is the perception that Warren Buffett buys but never sells. That is false. As the book describes, Buffett often employs trading strategies to achieve superior results. Although trader-like, the author makes clear that the one constant between Buffett's trading and investing strategies is the assurance of a margin of safety.

One of the more interesting aspects of this book is found in Chapter 9. This chapter discusses Buffett's personal holdings. While extensive coverage of Buffett's private transactions is not widely available, the author does a good job of gathering what is available and explaining exactly what, why, and how Buffett did over the years for his own trading account.

Chapter 9 also has an interesting tidbit of information. Buffett often relates that he owns a 100 or so shares in many different companies as a means to keep abreast of companies he believes are possible investments or as a way to follow competitors of companies he already has an interest. The book lists those securities owned by Buffett's private foundation, most of which are owned in 100 or so shares. For those interested in trying to decipher what Buffett is looking at the list presents interesting research material.

The Good News

A good solid look at Buffett's other means of achieving stock market success. Rather than examine the more well known facets of Buffett's investment style the book charts a fresh course of examination into Buffett's more trader-like investments.

The Bad News

Many of the ways in which Buffett trades may not be available to investors who lack significant trading capital. On a lighter note, the book cover has one of the worst pictures of Buffett I have ever seen.

The Bottom Line

For those who desire a complete understanding of Warren Buffett, this book is one that should be included in your library. For the merely curious, reading your local library copy should suffice.

Other Related Reading:



Jason said...


Great review. I have been looking for a new read and I think I may have found it!

penny stocks said...

I have a web site where I give investment advise on penny stocks and stocks under five dollars. I would like to comment about penny stocks what most investors fail to realize about so called penny stocks is that stocks trading under 1 dollar are really not worth messing with the real bargains are stocks trading between 1 dollar and 5 dollars a share. I recenly sold my shares in vonage holdings corporation for 5 dollars. I bought the shares in 2009 for 37 cents. this was a rare exception to the general rule most of the stocks trading under 1 dollar are not good investments. the way that you find low priced stocks that are worthy investments is to have as much knowledge and experience as possible about these type of securities. only than can you profit tremendously from these stocks.


Great book on stock investing.