Views on Life & on Equity Investing

Wonder, Wealth & Abundance

Ilustrated biography of Buffett : Comic readers delight

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Nice illustrated book I completed today, lets ones imagination build Buffett’s real world. Will send you back to Chapter 8 and 20 of the Ben Graham’s Intelligent Investor. Anyone who enjoys reading comic books would savor this biography. Link : Amazon

One has to admit Buffett was both born as well as determined to succeed although latter alone can be a sufficient condition.

Other than his passion and thirst for investing, Buffett’s wealth is blend of twin factors, long term compounding (8th wonder of the world) and borrowing other people’s money. He has been in business for 75+ years in theory and 70 years in equities alone.

Both Charlie and Buffett recommend either starting game early or living long enough to let the 8th wonder of world work its charm. If one saves 10,000 Rs per month for 40 years and compound it at 20% per annum (post inflation) it grows to 1.7 billion (170 Crores) Rs. in today’s value. BSE has returned those returns since 1980 ! Most of us including myself lack the discipline and patience but if one plays safe over long term, returns will actually be more than your imagination.

Another thought to remember is, if you or your children save 2000 $ per year from age of 18-25 i.e. 7 years only and then not save anything for the rest of their lives, they would outperform the person who saves 2000$ per year from 26-65 years of age i.e. 40 years, assuming return rate are constant/same during compounding, even though second person saved 33 years extra. Draw for them this chart and frame it in their room.

Written by amitdipsite

October 16, 2010 at 7:22 am

Posted in Uncategorized

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