Secrets in Plain Sight · Business & Investing Secrets of Warren Buffett, 2011 Edition (eBooks on Investing Series)

UPDATED MAY 2014

“The most insightful analysis of Buffett and Berkshire I’ve ever read.”

– Vitaliy N. Katsenelson, author of the “Little Book on Sideways Markets.”

“Jeff Matthews is a great writer, which make ‘Secrets in Plain Sight’ a must-read.”

– Bethany McLean, contributing editor of Vanity Fair and author of “The Smartest Guys in the Room.”

“Warren Buffett ... is our most successful investor and this book explains why. A great way to start on your path to prosperity.”

– Larry Kudlow, economist and host of The Kudlow Report on CNBC.

HOW DID WARREN BUFFETT DO IT?

How did Warren Buffett become the world's richest man? The greatest investor of our times? America's most successful business executive? Jeff Matthews, a 30-year Wall Street veteran and incisive Buffett watcher, travels to the Berkshire Hathaway annual meeting each year to unlock the “secrets” behind Buffett’s success as an investor and CEO. Matthews's findings: Buffett’s "secrets" are in plain sight, and 49 of them are in this book, including new secrets uncovered at the May 3, 2014 annual meeting. Secrets include:

SECRET # 9: READ EVERYTHING YOU CAN.

This is the first advice Warren Buffett gives to aspiring investors, and he isn’t kidding. “By the age of 10,” he says, “I’d read every book in the Omaha Public Library with the word ‘finance’ in the title, some twice.” Buffett’s reading habits did not stop there: he still reads thousands of financial statements and annual reports each year, and acquaintances who’ve shared rides on NetJets with Buffett report that he’ll chitchat briefly and then start reading from a stack of material. But Buffett doesn’t steer investors toward any particular investment style. Instead, he advises reading everything possible to find the style that suits you. Says the world’s best investor: “If it turns you on, it probably will work for you.”

SECRET #13: BE OPEN-MINDED. YOU NEVER KNOW WHERE YOU’LL FIND OPPORTUNITY.

Buffett originally spurned a chance to buy a small California-based boxed chocolate maker in the early 1970s. “I don’t think we want to be in the candy business,” he told the caller. At the time, Berkshire was mainly an insurance company. After looking hard at the numbers, however, and with the encouragement of his California-based business partner, Charlie Munger, Buffett changed his mind and they bought See’s Candies for a mere $25 million. It was one of the greatest acquisitions any company would ever make, and it happened because Warren Buffett was open-minded.

SECRET #15: LOOK FOR LOLLAPALOOZA IDEAS.

Buffett and Munger believe another key to investment success is to assiduously search for a few “lollapalooza” ideas … and when you do find them, make a major commitment. “You really want one that you don’t have to sell,” says Charlie Munger. “Then you can sit on your a__ for 30 years.”

SECRET #30: WORRY ABOUT EVERYTHING—NOBODY ELSE WILL DO IT FOR YOU.

“I don’t want to have the chances of having something go wrong to be slim, I wanna have it be none,” says Warren Buffett. “There’s no way I can assign that to a risk committee.” It is no coincidence that Berkshire Hathaway was one of the few financial companies in the world that required no bailout during the crisis. Says Buffett, “I worry about everything at Berkshire.