During his recent interview with EO Gurgaon, Mohnish Pabrai explained how Warren Buffett maximizes his investment returns without doing any heavy lifting. Here’s an excerpt from the interview:
When I first encountered Buffett and I was reading about him, what I realized is basically what he had done is that he had taken that four percent of time and expanded it to 80 percent.
And instead of doing the heavy lifting himself he spent all his time figuring out which businesses were great and which businesses were mispriced and which businesses had great business models. And then he would make passive investments into those businesses.
So he didn’t control those businesses, like he made an investment in Coke, made an investment in American Express, or he bought the railroad, and so on.
So a railroad of course they own it completely, but he bought it like an intact business is already running with management and all of that.
And I said wow this is awesome! That I could take four percent to 80 percent and I don’t have to do the heavy lifting. I don’t have to have any employees. If you don’t have any employees you have no problems.
And I don’t have to really do much, and I said this is the Holy Grail, I’m gonna go down this path and so that’s really what drew me into investing.
You can watch the entire discussion here:
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