Details

Buffett's Tips


Buffett's Tips

A Guide to Financial Literacy and Life
1. Aufl.

von: John M. Longo, Tyler J. Longo

19,99 €

Verlag: Wiley
Format: PDF
Veröffentl.: 24.11.2020
ISBN/EAN: 9781119763727
Sprache: englisch
Anzahl Seiten: 432

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Beschreibungen

<p>Praise for <b>BUFFETT'S</b> TIPS <p>"John Longo and his son, Tyler, have performed a valuable service, taking the wisdom of Warren Buffett (the supply of which is ample) and distilling from it 100 'tips,' with the authors' own explanatory text, to guide the reader from financial ignorance to a degree of financial literacy. Along the way, there are useful lessons for life in general. If you have a friend, child, or parent who needs a pathway to a better understanding of some financial fundamentals, get this book for them—it'll go a long way to bringing them up to speed."</br> <b>—Simon Lorne,</b> Vice Chairman and Chief Legal Officer, Millennium Management LLC; former Partner, Munger, Tolles & Olson <p>"Priceless. 100 investment and life tips from the Oracle—a great read for the beginning investor."</br> <b>—S. Basu Mullick,</b> retired Portfolio Manager and Managing Director, Neuberger Berman; former General Partner, Omega Advisors; noted value investor; former "Marketwatch Fund Manager of the Year" <p>"John Longo has a well-earned reputation for excellence in teaching at the University level. Working with his son Tyler, John now extends his passion for education out of the classroom and across generations with this guidebook to the essential tools for financial proficiency."</br> <b>—Gregory P. Francfort,</b> noted value investor; former Institutional Investor "All-Star Analyst" <p>"John and his son have written an invaluable guide steeped in the wisdom of Warren Buffett. Marrying sound financial advice with general life lessons, <i>Buffett's Tips</i> provides a solid foundation for advancing financial literacy across a broad multi-generational audience."</br> <b>—Joshua Rosenbaum, Joshua Pearl, Joseph Gasparro,</b> co-authors, <i>The Little Book of Investing Like the Pros</i> and <i>Investment Banking: Valuation, LBOs, M&A, and IPOs</i>
<p>Preface v</p> <p>Acknowledgements vii</p> <p>Chapter 1: Who Is Warren Buffett? 1</p> <p>Introduction 1</p> <p>Buffett the Teen 1</p> <p>Who Are We to Write this Book? 2</p> <p>What Is Financial Literacy and Why Does It Matter? 3</p> <p>Some Fundamental Buffett “Tips” 3</p> <p>Buffett’s Work Ethic 5</p> <p>Buffett Has Spent a Lifetime Learning 6</p> <p>Why Is Buffett Happy? 8</p> <p>Improve Your Communication Skills and See Your Lifetime Earnings Increase 50% 8</p> <p>Acting with Integrity is the Right Thing to Do and Good for Business 9</p> <p>Buy Low, Sell High 10</p> <p>Buffett Doesn’t Succumb to Peer Pressure: The Inner Scorecard 11</p> <p>Buffett’s Fallback Career - Comedian 12</p> <p>Buffett’s Lasting Legacy: Philanthropy 13</p> <p>Buffett’s Tips from Chapter 1 14</p> <p>Chapter 1 References 15</p> <p>Chapter 2: Investment Fundamentals According to Buffett 18</p> <p>Introduction 18</p> <p>The “Miracle of Compound Interest” Explained 18</p> <p>Tradeoffs: A Fundamental Principle of Life 20</p> <p>The Saint Petersburg Paradox: A Lesson on Risk and Return 21</p> <p>Risk and Return: The Evidence 22</p> <p>Diversification: One of the Few Free Lunches in Life 24</p> <p>Supply and Demand Determine Price 25</p> <p>Summary on Financial Fundamentals 26</p> <p>Buffett’s Tips from Chapter 2 27</p> <p>Chapter 2 References 28</p> <p>Chapter 3: Bank Accounts and Credit Cards 29</p> <p>Introduction 29</p> <p>Insured Bank Deposits 29</p> <p>Savings Accounts and Certificates of Deposit (CD) 30</p> <p>Checking Accounts and Electronic Bill Payment 31</p> <p>Parts of a Check 32</p> <p>Balancing a Checkbook 33</p> <p>Debit Cards and Automated Teller Machines (ATM) 34</p> <p>Credit Cards and Charge Cards 35</p> <p>Apps to Send Money: PayPal, Venmo, Zelle, Apple Pay, Android Pay, etc. 37</p> <p>Your Credit Score: A Report Card of Your Financial Responsibility 38</p> <p>Personal Bankruptcy: Try to Avoid at all Costs 40</p> <p>A Word on Bitcoin from Buffett 40</p> <p>Buffett’s Tips from Chapter 3 42</p> <p>Chapter 3 References 43</p> <p>Chapter 4: Bonds and Inflation 44</p> <p>Introduction 44</p> <p>U.S. Savings Bonds 44</p> <p>Other U.S. Treasury Fixed Income Securities 45</p> <p>Income and the Consumer Price Index (CPI) 47</p> <p>Bond Ratings and Corporate Bankruptcy 48</p> <p>Corporate Bonds, Municipal Bonds, and Bowie Bonds 50</p> <p>Bowie Bonds and Other Asset Backed Securities 50</p> <p>The Federal Reserve: The Central Bank of the United States 51</p> <p>What Determines Interest Rates? 53</p> <p>Intuition on Estimating the Price of a Bond 54</p> <p>So, Are Bonds Good Investments? 55</p> <p>A Note on Negative Bond Yields 56</p> <p>Buffett’s Tips from Chapter 4 56</p> <p>Appendix: Bond Valuation 57</p> <p>Chapter 4 References 58</p> <p>Chapter 5: Stock Market Fundamentals 59</p> <p>Introduction 59</p> <p>Initial Public Offerings (IPOs): The Birth of a Stock 59</p> <p>Investment Banks and Investment Bankers 59</p> <p>The Main Event: The Stock Begins Trading on the Stock Exchange 60</p> <p>The Stock Exchange 61</p> <p>A Sidebar on Stock and Mutual Fund Symbols 63</p> <p>Dividends 64</p> <p>Large Cap vs. Small Cap 66</p> <p>Growth vs. Value 68</p> <p>Domestic vs. International 69</p> <p>An Index Fund: A Great “Set It and Forget It” Long Run Investment 70</p> <p>Beating the Market and the Efficient Market Hypothesis 71</p> <p>Meet Mr. Market, the Manic-Depressive Stock Market 72</p> <p>Buffett’s Tips from Chapter 5 73</p> <p>Appendix: Selling Short (or the “don’t try this at home” area of investing) 74</p> <p>Chapter 5 References 76</p> <p>Chapter 6: Buffett’s Approach to Stocks 77</p> <p>Introduction 77</p> <p>Estimating the Value of a Stock 77</p> <p>Getting a Price Target with the Discounted Cash Flow Model 77</p> <p>Getting a Price Target with the Wall Street P/E Model 79</p> <p>Buffett’s Approach to Stocks 80</p> <p>Getting into the Buffett Mindset of Investing 81</p> <p>Stay Within Your Circle of Competence 82</p> <p>The Importance of Being Patient 82</p> <p>Good vs. Bad Companies and the Passage of Time 83</p> <p>How Buffett Thinks About Change in an Industry 84</p> <p>Types of Businesses Buffett Likes 84</p> <p>A Moat Around a Business is a Recipe for Success 84</p> <p>Demonstrated Consistent Earnings Power 85</p> <p>Look for Companies with Good Management 85</p> <p>But Good Management Can’t Help Sinking Industries 85</p> <p>Buy Companies That Have the Power to Overcome Inflation 86</p> <p>Focus on Firms with Favorable Long-Term Prospects 87</p> <p>When to Sell 88</p> <p>Summarizing Buffett’s Approach 89</p> <p>Buffett’s Tips from Chapter 6 90</p> <p>Chapter 6 References 91</p> <p>Chapter 7: Accounting Fundamentals 93</p> <p>Introduction 93</p> <p>The Income Statement: A Company’s Report Card for One Period 94</p> <p>Apple’s Income Statement 94</p> <p>The Balance Sheet: A Picture of the Company’s Report Card Since Inception 98</p> <p>Current Assets 99</p> <p>Long-Term Assets 100</p> <p>Liabilities 101</p> <p>Current Liabilities 102</p> <p>Long-Term Liabilities 103</p> <p>Stockholders’ Equity 103</p> <p>A Quick Note on the Statement of Cash Flows 105</p> <p>Summary 105</p> <p>Buffett’s Tips from Chapter 7 105</p> <p>Chapter 7 References 106</p> <p>Chapter 8: Buffett’s Approach to Portfolio and Risk Management 107</p> <p>Introduction 107</p> <p>The Key to Selecting a Well Diversified Portfolio: Correlation 107</p> <p>A (Theoretical) Portfolio with No Risk 108</p> <p>Selecting an Optimal Diversified Portfolio: The “Business School” Approach 109</p> <p>Buffett’s First Approach to Portfolio Selection: Index Funds 111</p> <p>Buffett’s Second Approach to Portfolio Selection: Expert Mode 111</p> <p>A Compromise Portfolio Solution 112</p> <p>Home Many Stocks Make a Diversified Portfolio? 113</p> <p>The Business School Approach to Risk 114</p> <p>Buffett’s Critique of the Business School Approach to Risk 116</p> <p>Buffett’s Approach to Risk 116</p> <p>Buffett on Gold 117</p> <p>Summarizing Buffett’s Views on Risk 118</p> <p>Buffett’s Tips from Chapter 8 119</p> <p>Endnote on CAPM 119</p> <p>Chapter 8 References 120</p> <p>Chapter 9: Business 101: Companies 122</p> <p>Introduction 122</p> <p>The Dow Jones Industrial Average: The Oldest U.S. Stock Market Index 122</p> <p>How The Dow is Calculated 123</p> <p>An Explanation of Stock Splits 124</p> <p>Different Share Classes and Buffett on Stock Splits 125</p> <p>Current Stocks in the Dow Jones Industrial Average 126</p> <p>Materials Stocks in The Dow 126</p> <p>Consumer and Business Services Stocks in The Dow 127</p> <p>Consumer Goods Stocks in The Dow 128</p> <p>Financial Stocks in the Dow 130</p> <p>Healthcare Stocks in the Dow 132</p> <p>Industrial Stocks in the Dow 133</p> <p>Technology Stocks in the Dow 134</p> <p>Telecommunications Services Stocks in the Dow 135</p> <p>Some Blue-Chip U.S. Stocks That Aren’t in the Dow 135</p> <p>The FANG Stocks – They Don’t Bite 136</p> <p>China’s Emerging Titans 137</p> <p>Some International Energy Titans 137</p> <p>Some Global Consumer Titans 138</p> <p>Some Global Financial Services Firms 138</p> <p>Buffett’s Tips from Chapter 9 138</p> <p>Chapter 9 References 139</p> <p>Chapter 10: Business 101: People 142</p> <p>Introduction 142</p> <p>Past Business Leaders 142</p> <p>Present Business Leaders 147</p> <p>Buffett’s Tips from Chapter 10 154</p> <p>Chapter 10 References 155</p> <p>Chapter 11: Being Thrifty Like Buffett: Ways to Save Money 158</p> <p>Introduction 158</p> <p>Your Library: Free Books, Magazines, Newspapers, Music, Movies, and More 158</p> <p>Free Educational Courses: Khan Academy, Coursera, edX 160</p> <p>Websites for Free Stuff 160</p> <p>Free Activities 161</p> <p>Amazon.com: The World’s Biggest Store 162</p> <p>Comparison Shopper Tools: Your New Best Friend 163</p> <p>Barter: Turning A Cell Phone into a Porsche 164</p> <p>Eat A Low-Cost Meal, Periodically 165</p> <p>Shop Private Label and Generic Items 165</p> <p>Clothes: Outlet Stores, Vintage Items, and Buying Off-Season 166</p> <p>Buying Gasoline 168</p> <p>Coupons, Double-Couponing, Triple-Couponing, and Groupon 168</p> <p>Rewards Programs 169</p> <p>Negotiating with Cell Phone, Cable, and Other Service Providers 170</p> <p>Yard Sales, Flea Markets, and More: Turning Trash into Treasure 171</p> <p>Do-It Yourself 172</p> <p>Donate Things to Charity 172</p> <p>Avoid Shooting Yourself in the Foot with Bad Habits 172</p> <p>Tying It All Together in A Budget 173</p> <p>Buffett’s Tips from Chapter 11 174</p> <p>Appendix: Sample Budget 175</p> <p>Chapter 11 References 176</p> <p>Chapter 12: Buffett’s Views on Cars and Homes 178</p> <p>Introduction 178</p> <p>Do You Need a Car? 178</p> <p>New Cars vs. Used Cars 179</p> <p>Buying vs. Leasing a Car 180</p> <p>The Best Time to Buy or Lease a Car 182</p> <p>Home Basics 183</p> <p>Finding a Home 184</p> <p>Bidding for a Home 184</p> <p>Paying for a Home: The Down Payment 185</p> <p>Paying for a Home: The Mortgage 186</p> <p>A “House Hack”: Getting Someone to Pay (Most of) Your Mortgage 187</p> <p>Looking Under the Hood of a Mortgage 188</p> <p>Buffett’s Tips for Chapter 12 191</p> <p>Chapter 12 References 178</p> <p>Chapter 13: Buffett on Dale Carnegie, Communication Skills, and Emotional Intelligence 194</p> <p>Buffett Learns Life Changing Skills in a Dale Carnegie Course 194</p> <p>CliffsNotes Version on Dale Carnegie and How to Win Friends and Influence People 195</p> <p>Things How to Win Friends and Influence People Will Do for You 196</p> <p>Techniques in Handling People According to How to Win Friends and Influence People 196</p> <p>Six Ways to Make People Like You According to How to Win Friends and Influence People 199</p> <p>How to Win People to Your Way of Thinking, According to How to Win Friends and Influence People 200</p> <p>What Is Emotional Intelligence (EQ)? 202</p> <p>Emotional Intelligence (EQ): Some Details 203</p> <p>Have a Great Posse 206</p> <p>Buffett’s Tips for Chapter 13 208</p> <p>Chapter 13 References 209</p> <p>Chapter 14: Buffett’s Tips for College 212</p> <p>Introduction 212</p> <p>College: The Basics 212</p> <p>Getting into a College 213</p> <p>Graduate School: Optional for Some Jobs, Mandatory for Others 215</p> <p>Paying for College: Scholarships and Grants 216</p> <p>Paying for College: The 3 Year Plan for Super Achievers 217</p> <p>Paying for College: 529 Plans 217</p> <p>Paying for College: Student Loans 217</p> <p>Paying for College: On and Off Campus Jobs 219</p> <p>Your Resume: A Snapshot of Your Qualifications for a Job 220</p> <p>Putting Together Your Resume 220</p> <p>The Objective Section 220</p> <p>The Education Section 221</p> <p>The Work Experience Section 222</p> <p>The Skills Section 223</p> <p>The Activities & Interests Section 223</p> <p>Cover Letter 224</p> <p>Buffett’s Tips from Chapter 14 224</p> <p>Appendix: Sample Resume 225</p> <p>Appendix: Same Cover Letter 226</p> <p>Chapter 14 References 227</p> <p>Chapter 15: Buffett’s Tips for Careers 228</p> <p>Introduction 228</p> <p>LinkedIn Profile: Your Online Profile 228</p> <p>Finding an Internship or Job 229</p> <p>The Job Interviews(s): Preparation 230</p> <p>The Job Interviews(s): Acing Your Interviews 232</p> <p>The Job Interview(s): Compensation or Show Me the Money! 234</p> <p>Succeeding on the Job 235</p> <p>Financial Paperwork After Getting a Job 237</p> <p>Forms W-2 and W-4 237</p> <p>Form 1040: The Annual Tax Form and “The Buffett Rule” 238</p> <p>Retirement Plans 239</p> <p>Becoming a 401k or IRA Millionaire 240</p> <p>Buffett’s Tips from Chapter 15 241</p> <p>Appendix: Health Benefits Information 242</p> <p>Appendix: Form W-2 245</p> <p>Appendix: Form W-4 246</p> <p>Appendix: Form 1040 247</p> <p>Chapter 15 References 248</p> <p>Chapter 16: Buffett’s Tips for Philanthropy 250</p> <p>Buffett’s Huge Gift and The Giving Pledge 250</p> <p>Getting Involved in Philanthropic and Charitable Activities 252</p> <p>Measuring Performance 253</p> <p>Market Based Economies Are Good… Unless You Wind Up as Roadkill 254</p> <p>It’s Not All About the Benjamins 256</p> <p>The Loss of Reputation Huts More Than the Loss of Money 257</p> <p>Inheritance Matters 259</p> <p>Buffett’s Definition of Success 259</p> <p>Buffett’s Tips from Chapter 16 260</p> <p>Appendix: Charitable Lunch Auctions for Warren Buffett Benefiting Glide Foundation 261</p> <p>Chapter 16 References 262</p> <p>Appendix: Glossary of Financial Terms in Plain English 263</p>
<p><b>JOHN M. LONGO</b> is a Professor of Profes- sional Practice in the Finance and Economics Department at the Business School of Rutgers University. He has also been visiting professor of finance at EMBA-Global Asia—the joint Executive MBA program of Columbia Business School, London Business School, and The University of Hong Kong. He has more than 25 years of professional investment experience and is currently serving as Chief Investment Officer of Beacon Trust, a $3+ billion registered investment advisor. A Chartered Financial Analyst (CFA), Professor Longo earned an MBA in Finance and a PhD in Finance from Rutgers, where he also received his BA degree. <p><b>TYLER J. LONGO</b> is a high school student in the Princeton, NJ area. He has completed the Introduction to Business, Finance, and Economics program for high school students at Columbia University and additional coursework in AP Economics, AP Statistics, and Financial Literacy. He has become financially literate in large part due to his work on this book.
<p><b>What if you could learn financial literacy from Warren Buffett himself?</b></p> <p>Finance is a language like any other: the more fluently you speak it, the further—and more comfortably—you travel. And if you want to improve your financial literacy, what better teacher could you have than Warren Buffett? Often described as the greatest investor of all time, Warren Buffett started his investment firm with$100 in the late 1950s and went on to become the billionaire and sage we know today. Along the way he’s reaped huge profits for fellow investors in Berkshire Hathaway and remains one of the most sought-after and closely watched figures in the business world.</p> <p>So how did he do it? In <i>Buffett’s Tips</i>, award-winning professor and professional investor John M. Longo demonstrates just how by translating decades of Buffett’s writings and media appearances into a 100 straightforward tips and strategies anyone can follow for enhanced financial literacy and independence, including:</p> <ul> <li>Essential concepts like the time value of money and compound interest</li> <li>Basic financial instruments, such as savings and checking accounts and certificates of deposit</li> <li>Approaches to valuing stock, including discounted cash flow and relative valuation</li> <li>How to build a portfolio in accordance with Buffett’s two golden rules</li> </ul> <p>Whether you want to grow your personal finances, develop your business acumen, or improve softer career skills such as emotional intelligence, there’s no one better to learn from than the most famous investor in the world—and no better way to do that than having a copy of <i>Buffett’s Tips</i> close at hand.</p>
<p>Praise for <b>BUFFETT'S</b> TIPS <p>"John Longo and his son, Tyler, have performed a valuable service, taking the wisdom of Warren Buffett (the supply of which is ample) and distilling from it 100 'tips,' with the authors' own explanatory text, to guide the reader from financial ignorance to a degree of financial literacy. Along the way, there are useful lessons for life in general. If you have a friend, child, or parent who needs a pathway to a better understanding of some financial fundamentals, get this book for them—it'll go a long way to bringing them up to speed."</br> <b>—Simon Lorne,</b> Vice Chairman and Chief Legal Officer, Millennium Management LLC; former Partner, Munger, Tolles & Olson <p>"Priceless. 100 investment and life tips from the Oracle—a great read for the beginning investor."</br> <b>—S. Basu Mullick,</b> retired Portfolio Manager and Managing Director, Neuberger Berman; former General Partner, Omega Advisors; noted value investor; former "Marketwatch Fund Manager of the Year" <p>"John Longo has a well-earned reputation for excellence in teaching at the University level. Working with his son Tyler, John now extends his passion for education out of the classroom and across generations with this guidebook to the essential tools for financial proficiency."</br> <b>—Gregory P. Francfort,</b> noted value investor; former Institutional Investor "All-Star Analyst" <p>"John and his son have written an invaluable guide steeped in the wisdom of Warren Buffett. Marrying sound financial advice with general life lessons, <i>Buffett's Tips</i> provides a solid foundation for advancing financial literacy across a broad multi-generational audience."</br> <b>—Joshua Rosenbaum, Joshua Pearl, Joseph Gasparro,</b> co-authors, <i>The Little Book of Investing Like the Pros</i> and <i>Investment Banking: Valuation, LBOs, M&A, and IPOs</i>

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