“Indeed, at Berkshire, I sometimes engage in large-scale derivatives transactions in order to facilitate certain investment strategies.” Warren Buffett That’s right, Warren Buffett is a big user of these weapons of mass destruction. Jest aside, options can be a great tool to complement investing when used appropriately. Buffett’s Thoughts on Options In Berkshire’s 2008 and 2010 annual letter, after highlighting the dangers of derivatives, Buffett explained in detail why he uses options to generate float for investing: “Both Charlie and I believe that Black-Scholes produces wildly inappropriate values when applied to long-dated options.We put our money where our mouth was by entering into our equity put contracts. By doing so, we implicitly asserted that the Black-Scholes calculations us

I have been both a $Meta Platforms, Inc.(META)$ and $Alphabet(GOOGL)$ shareholder for a few years now... But never would I ever have expected that the popular narrative to become that Meta has a wider moat than Google.If we invest solely based on first order impact, we are going to have a rough time as business owners. There're a lot of moving parts and the truth is these businesses are a lot less fragile than most people think.Trust me when I say: Don’t buy based on stock tips alone Avoid the news like the plague Do not leverage And it will increase the odds of you compounding your wealthMy journey with investing began 15 years ago when I would visit my library every morning to read our local newspaper

Terry Smith on Inflation Not all companies are impacted equally. The biggest frontline of protection is not having COGS a big % of expenses. Companies with high GPM will defend themselves better in times of inflation. During periods of high inflation (>5%), quality companies will outperform the index. Historically, it only underperformed during one of the high inflationary period.

You asked, I delivered.Many of you have asked me how to value a company.To best address this topic, I went back to basics.Valuation by Mckinsey, Aswath Damodaran's lectures, MM papers and more. In this post you'll find:• primer on stock valuation• FREE intrinsic value calculator• complete list of resources on mastering valuationCheck out: A Primer On Valuation 👇https://steadycompounding.com/investing/valuation/