Warren Buffett’s Rip Van Winkle Approach to Investing Explained
In his 1991 Berkshire Hathaway Annual Letter, Warren Buffett stresses a patient, focused investment strategy, likening the stock market to a mechanism that transfers wealth from active to patient participants.
He highlights Berkshire Hathaway’s first significant international investment in Guinness, while reaffirming confidence in enduring businesses like Coca-Cola and Gillette. Buffett stresses the importance of investing in large, understandable businesses with strong economics and exceptional management, rejecting frequent trading or diversification across mediocre enterprises.
Quoting John Maynard Keynes, he advocates concentrating investments in a few well-understood companies with trustworthy management, noting that…
