How to Invest Like Warren Buffett

Can retail investors mimic Warren Buffett? It would be impossible to match his leverage but his focus on cheap, quality companies and maintaing liquidity are easier to replicate

John Rekenthaler 8 February, 2019 | 12:04PM

Warren Buffett

The idea of studying why Warren Buffett has been so successful was first looked at in detail in a 2012 article “Buffett’s Alpha” by AQR Capital Management’s Andrea Frazzini, David Kabiller, and Lasse Heje Pedersen.

The authors evaluated Berkshire Hathaway’s results analytically. Previous accounts of Warren Buffett’s leadership were largely biographical. They conveyed Buffett’s personal experiences and mindset, but they were light on forensics. "Buffett’s Alpha" starts from the opposite side. Never mind the man’s life. What can we say about his portfolio, as measured by the latest diagnostic techniques?

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About Author

John Rekenthaler

John Rekenthaler  John Rekenthaler is vice president of research for Morningstar.

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