Category: Famous Investors

Sir John Templeton, aged 95, passed away yesterday, July 8th, 2008. John Templeton was a legendary contrarian investor and a tireless philanthropist. He will be greatly missed by all who knew him and of his many accomplishments.

In February of 1987, the Templeton Emerging Markets Fund debuted on the New York Stock Exchange. Very few investors in those days cared to dabble in emerging market stocks. After the stock market crash in October of that year few investors indeed cared to dabble in emerging market stocks. The Templeton Emerging Markets Fund, which traded around $14 at the end of its first trading day, lost more than half its value and fell to $6 by the end of the year. Not exactly a great start for a new fund.

For Sir John Templeton that opening performance was not a problem. This super contrarian seemed to relish adversity. He built a career – and a huge fortune – by investing during what he called “the moment of maximum pessimism.”

Warren Buffet is a skilled communicator in all aspects of life. Communication is the real key of leadership. Warren communicates openly and frankly with his investors and makes sure that he can communicate effectively with the managers of a company before he buys it.

Warren Buffet is estimated to be at a net worth of $50 to $55 billion. This is after Warren Buffet has donated billions of Dollars to Bill Gates to support Bill Gate’s foundation. Warren Buffet expresses concern that there is discontent growing in America that the children of the middle class will not fare as well in their work lives as their parents now fare in our society. Against the backdrop of the super wealthy having increased their wealth so substantially in the last decade his argument is made the stronger by the fact that middle class incomes have been stagnant.

Sir John Templeton rates right up there with Warren Buffet as one of the all time great stock market investors.

A few notable quotes from John Templeton are:

“Rejecting technical analysis as a method for investing, Templeton says, “You must be a fundamentalist to be really successful in the market.”

“Invest at the point of maximum pessimism.”

“If you want to have a better performance than the crowd, you must do things differently from the crowd.”

When asked about living and working in the Bahamas during his years of management of the Templeton Group, Templeton replied, “I’ve found my results for investment clients were far better here than when I had my office in 30 Rockefeller Plaza. When you’re in Manhattan, it’s much more difficult to go opposite the crowd.”

John Templeton was born into a poor Tennessee family. He attended Yale University on a scholarship and graduated at the top of his class from Yale University in 1934 with a degree in economics. He went to Oxford in England as a Rhodes Scholar. He obtained a M.A. in law in 1936.

Warren Buffet hasn’t let age slow him down very much.

On his 76th birthday Warren Buffet married his long term girlfriend Astrid Menks. Then about a year ago Buffet donated about 31 billion dollars to charity, most of it going to the Gates Foundation.

How’s that for a powerful combination? The number one and number two richest men on this planet combining forces to be a force for good deeds in this world.

What a positive statement for enlightened capitalism.

How did Warren Buffet become so rich? The primary way is by making value based investment decisions and by living to be 76. Buffet is one of the gurus of the value investment approach to investing.

Warren Buffet bought control of textile firm Berkshire Hathaway in 1965. Using that company as his investment vehicle Buffet bought into companies that he understood and in whose management teams he trusted.

Then he held on. There was no attempt to out guess the market or to try and time short term exit and entry points.

The key to what made Warren Buffet so rich is simple. He did his homework, bought undervalued companies, and held on to his holdings for the long haul.