Warren Buffett’s Ground Rules – Jeremy Miller

Warren Buffett’s Ground Rules Words of Wisdom from the Partnership Letters of the World’s Greatest Investor is an “anti-Buffett” checklist for mediocracy in investment, derived from a study of the pre-Berkshire Partnership Letters. Author Jeremy Miller is an investment analyst.


  • Failure in investing in stocks is due to the following reasons: predicting short term outcomes, listening to the day-to-day wisdom of the market, playing someone else’s game

Do Not Predict Price

  • Today’s culture that benefits from churn of investors portfolio
  • Buffet thought “I’m not in the business of predicting the general stock market or business fluctuations. If you think I can do this, or think it’s essential to an investment program, you should not be in the partnership”

Do Not Listen to the Market

  • “You will not be right simply because a large number of people momentarily agree with you… you will be right, over the course of many transactions, if your hypothesis is correct, and your reasoning is correct. True conservatism is only possible through knowledge and reason
  • Trading is not your friends
  • Buffet view is that risk is not beta (volatility). Risk is not knowing what you’re doing when investing or the chance of being wrong on your investment thesis

Do Not Play Someone Else’s Game

  • “I will not abandon a previous approach whose logic I understand even though it may mean forgoing large and apparently easy profits to embrace an approach which I don’t fully understand …”

Other Notes

  • Buffet started his investment strategy similar to Ben Graham where the approach was to find struggling companies that the price is worth more than the assets it owns
  • Later with Munger, the approach shifted towards investing in great companies that can compound over time (eg. American Express)