D1's Sundheim: One Nugget of Buffett Wisdom Changed His Mindset
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Yahoo
an hour ago
- Yahoo
Warren Buffett's Favorite Money-Making Strategy is ‘Purchasing Fractional Interests in Easily-Identifiable Princes at Toad-Like Prices'
Warren Buffett, chairman and CEO of Berkshire Hathaway (BRK.B) (BRK.A), is celebrated for his candid reflections on both his successes and mistakes in the world of investing. In his 1981 shareholder letter, Buffett offered a characteristically honest assessment of his experience with corporate acquisitions, stating, 'We have tried occasionally to buy toads at bargain prices with results that have been chronicled in past reports. Clearly, our kisses fell flat. We have done well with a couple of princes — but they were princes when purchased. At least our kisses didn't turn them into toads. And, finally, we have occasionally been quite successful in purchasing fractional interests in easily-identifiable princes at toad-like prices.' This quote encapsulates a philosophy that has come to define Buffett's investment approach: the preference for acquiring high-quality businesses — 'princes' — at reasonable prices, rather than hoping to transform struggling companies — 'toads' — through managerial intervention or through optimism alone. Buffett's metaphor draws from the classic fairy tale, but its lesson is grounded in decades of real-world investing experience. It boils down to a simple idea: buy high-quality companies and let them continue to grow. Expanding on that core principle, it's better to buy a high-quality company at an 'ok' price than a bad company at a great price, because the quality company will ultimately deliver greater value, while the lower-quality company is likely to continue its decline. More News from Barchart NVDA Broken Wing Butterfly Trade Targets A Profit Zone Between 150 and 160 Is Opendoor Stock a Buy at New 52-Week Highs? Billionaire Peter Thiel is Betting Big on Stablecoins. Should You Buy the "MicroStrategy of Ethereum," Too? Our exclusive Barchart Brief newsletter is your FREE midday guide to what's moving stocks, sectors, and investor sentiment - delivered right when you need the info most. Subscribe today! Early in his career, Buffett was known for seeking out so-called 'cigar butt' investments — companies trading at deep discounts to their intrinsic value, often because of operational or industry challenges. While these bargains sometimes yielded quick profits, Buffett found that time was rarely on the side of a mediocre business. As he and his longtime partner, the late Charlie Munger, evolved Berkshire Hathaway's strategy, they shifted focus toward companies with durable competitive advantages, strong management, and the ability to compound earnings over long periods. Buffett's admission that his historical attempts to 'kiss toads' have rarely produced miracles is supported by both his own track record and broader market evidence. Numerous studies and post-mortems on corporate acquisitions have shown that turnarounds are difficult to execute and often fail to deliver the hoped-for returns. By contrast, investments in well-run, fundamentally sound businesses — especially when purchased at attractive prices — have consistently been the cornerstone of Berkshire Hathaway's long-term success. The final part of Buffett's quote — highlighting the success of buying 'fractional interests in easily-identifiable princes at toad-like prices' — speaks to another key element of his philosophy: the willingness to invest in minority stakes in great companies when full ownership is not feasible or prudent. This approach has led Berkshire to build substantial positions in firms like Coca-Cola, American Express, and Moody's, generating significant value for shareholders without the risks associated with full takeovers. Buffett's reflections remain highly relevant in today's markets, where the allure of turnaround stories and high-premium acquisitions continues to tempt corporate leaders and investors alike. His experience serves as a reminder that discipline, patience, and a focus on intrinsic business quality are more reliable paths to enduring success than the hope of miraculous transformations. In a world full of both princes and toads, Buffett's advice is clear: invest where the odds — and the underlying economics—are in your favor. On the date of publication, Caleb Naysmith did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Forbes
an hour ago
- Forbes
Onward! A Personal Tribute To Ed Feulner (1941-2025)
Ed Feulner and three of his main intellectual inspirations: G.K. Chesterton, Russell Kirk, and F. A. ... More Hayek painting by Deborah Melvin Beisner. Photo of a copy of the painting in the author's possession Dr. Edwin J. Feulner Jr. was such a significant policy player for over 50 years that, although numerous leaders have already shared memories of how he influenced their lives, there is ample room for further tributes. I first heard of Ed, as he liked to be called, as an immigrant from Argentina in the late 70s. For me Ed was an immense inspiration and later an extremely generous mentor and advisor. I came to the United States in 1978 to study under Dr. Hans F. Sennholz at Grove City College. Sennholz had been a disciple of Ludwig von Mises and, though of course primarily a teacher, was very active as a speaker in conservative free-market circles. He introduced me to the work of Feulner at the Heritage Foundation. I finally met Feulner in September 1980, when I was invited to the Mont Pelerin Society (MPS) meeting held at the Hoover Institution. Feulner became a key member of the MPS, occupying several leadership positions. My acquaintance with Ed deepened starting in 1985 when I joined Antony Fisher, the founder of the Institute of Economic Affairs in London and later founder of the Atlas Economic Research Foundation. Fisher attempted to hire Feulner to lead the International Center for Economic Policy Studies (ICEPS, today the Manhattan Institute). In 1978, Fisher had been discussing the creation of a New York-based think tank with his friend William J. "Bill" Casey, then a New York lawyer. Just as Feulner was about to start his new job, the recently established Heritage Foundation made him a much better offer, and the rest is history. Although disappointed at not being able to hire him, Fisher remained friends with Feulner and invited him to speak at Atlas events. As in its early days Atlas was located in San Francisco, far from Heritage, at first, I mostly saw Feulner at the meetings of the Mont Pelerin Society. At one of those meetings, in Guatemala, I as a member of the program committee was able to invite Fr. Robert Sirico to speak. Sir John Templeton, who worked closely with Antony Fisher, attended the meeting as well. Following conversations during the meeting, Fr. Sirico decided to establish the Acton Institute for the Study of Religion and Liberty, and both Feulner and I were asked to be on Acton's founding board. At the end of our first Acton board retreat, I drove to the airport together with Ed. When I am with influential people, I ask the same questions: Whom do you always read? Who is doing great work, and should we support them more? And: What is the biggest problem we face today in our battle for freedom? I recall his answer to the latter vividly. It was in the mid 90's and Ed said: 'The young people who are joining the movement have a very shallow and superficial understanding of the principles of the free society. They join our think tanks, but they never went through the process of studying all the main works, the Founding Fathers, the great economists, Mises, Hayek, Friedman, conservative thinkers like Russell Kirk.' Feulner invested his time in organizations such as the Intercollegiate Studies Institute (ISI), where he served as a long-standing trustee and chairman. ISI aims to fill the void Feulner spoke of by creating fellowships and academic programs for talented young people. In addition to his role as a think tank leader, Ed Feulner also played a significant role in grant-giving foundations such as the Sarah Scaife Foundation, which supports dozens of policy think tanks. He also served as an inspiration for other foundations. A little-known fact is that Sir John Templeton, in starting his organization, included Feulner on its charter as one of the authors who should serve as a guide for its grants in the realm of free enterprise. The other authors who preceded him are Adam Smith, Ludwig von Mises, F.A. Hayek, Milton Friedman, William E. Simon, and Antony Fisher. Ideas never die, and Ed Feulner's views and legacy will continue to inspire many of us. In addition to his leadership at think tanks and philanthropic organizations, Dr. Feulner played a role in various political campaigns. He worked alongside Jack Kemp when he was vice presidential candidate with Bob Dole. He also joined the campaign for Trump's 2016 presidential run. In 2016, at a private meeting with freedom fighters from around the world, Ed told us: 'Trump put one condition, that if we disagree with a policy, like I did on tariffs, we keep our disagreement private.' Dr. Ed Feulner being recognized for his service to the Mont Pelerin Society during the Hong Kong ... More general meeting in 2014. Dr. Allan H. Meltzer (1928-2017), then president of the Society, at his side When in 2014 the Mont Pelerin Society asked me to help choose a gift for Ed Feulner, I had a unique opportunity to learn about what inspired him. Without revealing my intention, I asked him during a private meeting at his office which intellectuals had had the greatest impact on his life. He was quick to answer G.K. Chesterton, Russell Kirk, and F.A. Hayek. An artist who knew him well, Debby Beisner, captured his response in a beautiful painting. Books will be written about Ed Feulner and his legacy. For now, one of his favorite words suffices to remember his spirit: Onward!
Yahoo
an hour ago
- Yahoo
2 Vanguard ETFs That Can Turn $400 per Month Into Over $1.7 Million
Key Points The Vanguard S&P 500 ETF provides investors with exposure to the world's largest companies across every major industry sector. The Vanguard Dividend Appreciation ETF complements growth-oriented investments with a mix of value stocks and reliable dividend income. Both of these funds offer inexpensive management fees and can help turn small monthly contributions into millions over a long-term time horizon. 10 stocks we like better than Vanguard S&P 500 ETF › A common misconception about creating wealth is that you need to be an expert stock picker. While investing in individual companies can indeed generate significant savings, there are many other ways an investor can benefit from the appreciation of the stock market. One such way is through exchange-traded funds (ETFs). ETFs represent a basket of stocks and provide investors with passive exposure to specific industries or themes. Below, I'll detail two Vanguard ETFs that can help investors become millionaires while barely lifting a finger. 1. Vanguard S&P 500 ETF While Warren Buffett is primarily known for his successful stock picking abilities, the famous investor often expresses that most investors should simply buy into the S&P 500 index. While this sounds nice in theory, how can you actually do that? Well, the Vanguard S&P 500 ETF (NYSEMKT: VOO) has you covered. This fund provides investors with passive exposure to the companies that comprise the S&P 500. Not only does this help investors achieve a high degree of diversification, but it also mitigates downside risk as industries respond to news and economic shifts in different ways. One thing that makes this Vanguard ETF different than other S&P 500-themed funds is that it is weighted by market cap. This means that the companies with the largest market caps -- such as Nvidia, Microsoft, Apple, Berkshire Hathaway, or Eli Lilly -- have more of an influence on the fund's price movements relative to smaller companies. Per the graph above, the Vanguard S&P 500 ETF has generated a total return of 647% since its inception in 2010. This equates to 14.5% annually. Assuming these returns keep up, a $200 monthly investment can grow significantly over the course of a long-term time horizon. Timeline Long-Term Savings 10 Years $53,400 20 Years $279,078 30 Years $1,232,848 Calculations by author via 2. Vanguard Dividend Appreciation ETF The Vanguard Dividend Appreciation ETF (NYSEMKT: VIG) is made up of companies that have increased their dividend payments over 10 years or more. This is important to understand, as inclusion in the index isn't guaranteed simply by offering a juicy dividend yield. Instead, members of the VIG index are companies that have proven to sustain their dividend payments while having the financial flexibility to increase them over time. I see this fund as a great complement to VOO since it offers a unique mix of growth and value stocks that serve as reliable sources of dividend income such as Visa, Broadcom, and Walmart. The fund's annual return since inception hovers right around 10%, which is slightly better than the long-run average return of the S&P 500 index. Assuming these returns keep up, a $200 monthly contribution can grow to roughly $450,000 over the course of 30 years. Keep these ideas in mind An important factor to consider when choosing an ETF is the expense ratio. With expense ratios of 0.03% and 0.05% for VOO and VIG, respectively, investors are paying less than $1 per $1,000 invested. While VOO and VIG can help make you a millionaire, it's important that investors consistently contribute to their positions on a frequent basis. Moreover, it's equally important to remember that building a seven-figure savings can take decades. The more important idea explored in this piece is that building wealth takes time, discipline, and patience. All told, I see both of these Vanguard funds as low-cost and low-effort ways to generate significant wealth. Should you invest $1,000 in Vanguard S&P 500 ETF right now? Before you buy stock in Vanguard S&P 500 ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vanguard S&P 500 ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $665,092!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,050,477!* Now, it's worth noting Stock Advisor's total average return is 1,055% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Adam Spatacco has positions in Apple, Eli Lilly, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Apple, Berkshire Hathaway, Microsoft, Nvidia, Vanguard Dividend Appreciation ETF, Vanguard S&P 500 ETF, Visa, and Walmart. The Motley Fool recommends Broadcom and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. 2 Vanguard ETFs That Can Turn $400 per Month Into Over $1.7 Million was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
