Steve Alexander

Book Review: Warren Buffett and the Interpretation of Financial Statements, by Mary Buffett and David Clark

Greenwald is an excellent author on competitive advantage. One of my articles on here reviews his book Competition Demystified, which I thought was a fantastic study on competitive dynamics. Pat Dorsey (of Morningstar) also talks eloquently on the factors behind sustainable economic moats. The book reviewed here is very much a "lite" version of their material.

Buying a Buffett Portfolio

This is how I like to invest as well. I use the Magic Formula stock screen - the point of the strategy is to find good companies (high return on capital) at low prices (high earnings yield). Then check out the long term moat characteristics to make sure a stock is not a flash in the pan. You definitely have some excellent companies there, but a stock does not have to be owned by Berkshire to have these characteristics. Look at some of the smaller caps as well, even Buffett has said that these offer the greatest gains for the individual investor.

Steve
magicdiligence.com