Every May, a group from Burgundy heads down to Omaha, Nebraska for Berkshire Hathaway’s Annual General Meeting (AGM). This AGM is like no other! The venue is the CenturyLink Center – picture Toronto’s Air Canada Centre with a convention centre attached. The only way I know to describe the AGM is a cross between a rock concert and flea market. The rock stars are none other than Warren and Charlie (first names only, in keeping with the rock-star mentality). The flea market comprises of every Berkshire-related company peddling their wares; while saving money on car insurance, you can buy cowboy boots, eat a dilly bar and wash it down with a can of Coke. And that is just a start!

The crowd is equally eclectic. From famous money managers to families with multiple generations in tow, everyone is there to catch a glimpse of the stars! The atmosphere is electric as most people in attendance feel they owe at least a piece of what they have today to Warren and Charlie.

The brilliance of this dynamic duo is not limited to their obvious investment genius; they have an innate ability to teach their disciples about value investing as a craft, as well as to provide their rich historical context and worldly views. In a remarkable feat of endurance, Warren (84) and Charlie (90) field questions practically all day – minus the hour-long lunch break during which the attendees are encouraged to spend freely on those peddled wares! Each year, the event provides a forum for Warren and Charlie to reinforce their core investing principles, the cornerstone of their remarkable long-term success.

Here are some high-level principles that stood out to me as good reminders:

  • Investing is an art as much as a science. It’s better to be approximately right than precisely wrong. Even Warren and Charlie can only agree to within 5% concerning Berkshire’s intrinsic value. More important than intrinsic value precision is maintaining a degree of conservatism during its calculation and demanding a margin of safety at purchase. That is how you define value.
  • A company’s earnings power per share drives its intrinsic value.
  • Good business managers constantly examine what emerging trend might disrupt their business model. They must remain nimble, adaptive and open to change.
  • Unless you can handicap the winners, there is no sense investing in an industry. It may be easy to predict the general success of the industry, but this does not equate to an ability to pick out the individual investments within that will win big.
  • Partner with people who are better than you. While this may be impossible for Warren, he certainly found an equal in Charlie.
  • To build wealth in business or investing, patience is required. The main reason people have not duplicated Warren and Charlie’s success is because, “The slowness deters people more than anything else.”

While there are many more lessons from the AGM, one stands above the rest: there is always more to learn. These two rock-star-billionaire intellectuals – with a combined age of 174 years and millions of followers – manage to stay humble in the face of what remains to be learned. Even as we make mistakes, we can learn from them – and from the mistakes and success of others. As Charlie put it in his classic way, Berkshire’s success can be largely attributed to their tireless and endless pursuit of “ignorance removal” over many years.

If you would like to learn more, I suggest reading Berkshire’s most recent letter to shareholders. And better yet, pair it with The Essays of Warren Buffett: Lessons for Corporate America, a compilation of Warren’s annual shareholder letters, sorted by topic.


This post is presented for illustrative and discussion purposes only. It is not intended to provide investment advice and does not consider unique objectives, constraints or financial needs. Under no circumstances does this post suggest that you should time the market in any way or make investment decisions based on the content. Select securities may be used as examples to illustrate Burgundy’s investment philosophy. Burgundy funds or portfolios may or may not hold such securities for the whole demonstrated period. Investors are advised that their investments are not guaranteed, their values change frequently and past performance may not be repeated. This post is not intended as an offer to invest in any investment strategy presented by Burgundy. The information contained in this post is the opinion of Burgundy Asset Management and/or its employees as of the date of the post and is subject to change without notice. Please refer to the Legal section of this website for additional information.