A:

Warren Buffett may have been born with business in his blood. He purchased his first stock when he was 11 years old, and worked in his family’s grocery store in Omaha. His father, Howard Buffett, owned a small brokerage, and Warren would spend his days watching what investors were doing and listening to what they said. As a teenager, he took odd jobs, from washing cars to delivering newspapers, using his savings to purchase several pinball machines that he placed in local businesses.

His entrepreneurial successes as a youth did not immediately translate into a desire to attend college. His father pressed him to continue his education, with Buffett reluctantly agreeing to attend the University of Pennsylvania. He then transferred to the University of Nebraska, where he graduated with a degree in business in three years.

After being rejected by the Harvard Business School, he enrolled in graduate studies at Columbia Business School. While there, he was taught by Benjamin Graham and David Dodd, both well-known securities analysts. Buffett was a fan of Graham’s book “The Intelligent Investor,” and it was under Graham that Buffett learned the fundamentals of value investing.

The Buffett that modern investors admire almost wasn’t. When he graduated from Columbia he intended to work on Wall Street, but Graham convinced him to make another career choice. Back in Omaha, Buffett worked as a stockbroker and opened several partnerships. The size of the investing partnerships grew substantially, and by the time he was 31 he was a millionaire.

It was at this point – in 1961 – that Buffett’s sights turned to directly investing in businesses. He made a $1 million investment in a windmill manufacturing company, and the next year in a bottling company. Buffett used the value investing techniques he learned in school, as well as his knack for understanding the general business environment, to find bargains on the stock market. Looking for new opportunities, he discovered a textile manufacturing firm called Berkshire Hathaway (BRK.A), and began buying shares in it. He later took control of the company in 1965. Like Berkshire Hathaway, he made some other good investments, like American Express (AXP), a company that doubled in price within two years of his initial.

Warren Buffett’s investments weren’t always successful, but they were well thought out and followed value principles. By keeping an eye out for new opportunities and sticking to a consistent strategy, Buffet and the textile company he acquired long ago are considered by many to be one of the most successful investing stories of all time.

RELATED FAQS
  1. What schools did Warren Buffett attend on his way to getting his science and economics ...

    Learn how Warren Buffett became so successful through his attendance at multiple prestigious schools and his real-world experiences. Read Answer >>
  2. What was the worst investment Warren Buffett made in his career?

    Discover what Warren Buffett's surprising answer is to the question of what was the single worst investment that the "oracle ... Read Answer >>
  3. How did Warren Buffett's investing style conflict with Benjamin Graham's theories ...

    Find out how Warren Buffett's value investing style contrasts with that of his mentor, Benjamin Graham, by relying on quality ... Read Answer >>
  4. Who does Warren Buffett plan to bequeath his estate to?

    Find out how much Warren Buffett is leaving for his heirs and how he wants the funds invested after his death. Learn about ... Read Answer >>
  5. Why does Warren Buffett largely avoid investing in the technology sector?

    Learn about why Warren Buffett has traditionally avoided investing in technology companies. Read about his value investing ... Read Answer >>
  6. What is Warren Buffett's annual salary at Berkshire Hathaway?

    Learn more about how much Warren Buffett receives in salary and how he continues to stay involved with his company and his ... Read Answer >>
Related Articles
  1. Insights

    Warren Buffett: The Road To Riches

    Find out how he went from selling soft drinks to buying up companies and making billions of dollars.
  2. Insights

    Warren Buffett Biography

    Warren Buffett is one of the top investors in the world. Learn more about his amazing life and path to success.
  3. Managing Wealth

    Buffett's Early Days as a Value Investor

    How did Warren Buffett get to be the richest investor in America? A little luck, a lot of pluck and a head for numbers.
  4. Insights

    4 Reasons Buffett's Portfolio Is Irrelevant to Today's Investors (AXP, KO)

    Find out why investors should not try to emulate Warren Buffett's stock portfolio and why they could not achieve his same level of success.
  5. Investing

    Why Warren Buffett Envies You

    The Oracle of Omaha can move over - there's a new investor in town.
  6. Investing

    Where Does Warren Buffett Keep His Money?

    Understand who Warren Buffett is and how he made most of his net worth. Learn about the main places and investment vehicles where Buffett keeps his money.
  7. Investing

    Should You Copy How Warren Buffett Invests?

    Buffett has proven to be one of the most astute investors of all time. Can you emulate his success?
  8. Investing

    6 Successful Investments Warren Buffett Passed On (GOOGL, XRX)

    Even Warren Buffett, the greatest investor of our time, has made many unforced errors. Investors can learn from his mistakes of omission and commission.
RELATED TERMS
  1. Warren Buffett

    Known as "the Oracle of Omaha", Buffett is Chairman of Berkshire ...
  2. Berkshire Hathaway

    A holding company for a multitude of businesses run by Chairman ...
  3. Oracle Of Omaha

    A nickname for Warren Buffett, who is arguably one of the greatest ...
  4. Benjamin Graham

    Benjamin Graham was an influential investor and pioneer in the ...
  5. Graham Number

    A figure that measures a stock's fundamental value by taking ...
  6. Mr. Market

    An imaginary investor devised by Benjamin Graham and introduced ...
Hot Definitions
  1. Block (Bitcoin Block)

    Blocks are files where data pertaining to the Bitcoin network is permanently recorded.
  2. Fintech

    Fintech is a portmanteau of financial technology that describes an emerging financial services sector in the 21st century.
  3. Ex-Dividend

    A classification of trading shares when a declared dividend belongs to the seller rather than the buyer. A stock will be ...
  4. Debt Security

    Any debt instrument that can be bought or sold between two parties and has basic terms defined, such as notional amount (amount ...
  5. Taxable Income

    Taxable income is described as gross income or adjusted gross income minus any deductions, exemptions or other adjustments ...
  6. Chartered Financial Analyst - CFA

    A professional designation given by the CFA Institute (formerly AIMR) that measures the competence and integrity of financial ...
Trading Center