Warren Buffett Explains How He Calculates a Margin of Safety

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Warren Buffett and Charlie Munger speaking at the 2004 Berkshire Hathaway annual meeting.

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"You only look at the ones that you are capable of evaluating and you skip all the rest"

ivanlam
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- Use conservative estimates for variables when calculating intrinsic value (1:00)

- After assessing variables, apply a margin of safety to your conclusion (1:13)

- Relate to insurance pricing for natural disasters as an analogy for margin of safety (2:01)

ReflectionOcean
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True gem. understood their approach on risk management

CentralParkish