A letter a day!

Recently Warren Buffett released his annual letter to shareholders. I have read his letters not chronologically but in bits and parts. Hence I have decided to start “A letter a day series” with new letter each day along with my own learning’s from the same.

Spread this word to anyone who would like to read/or re-read this letters.

Happy reading!!


Please share the link to the letters.
Thanks in Advance.


A letter a day

Day 1:

The first letter is from the year 1957. My key learnings from the same:

  1. Firstly Buffett talks about market valuations and their approach to the same. Each stock is classified by them into 2 categories
  1. Undervalued situation.
  2. Workout portfolio (which means special situations)

When according to him the markets are Undervalued, he chose exclusive capital deployment including the use of borrowed money in the Undervalued situations.

In case of higher market valuations, he would choose to park more funds in special situations stocks.

  1. He explains the importance of the role of luck in the short term and also the availability of funds to park at the right time.

  2. He states that his performance is mostly better in the bear markets than in the bull markets.

  3. The largest position in the portfolio comprises 10-20% allocation and he takes time to allocate 20% to a stock. This is a matter of patience.

  4. His expectation from a stock at an early stage is to decline or do nothing rather than advance. This indicates most of his bets are with a long-term view and no overnight returns are expected.

I have attached a highlighted copy of the first letter. Please feel free to share your learnings too.

A letter a day(WB1957)_Aashka Trivedi.pdf (16.7 KB)


Feb 2023 Letter, the theme of the letter was how owning a great business for an extended period produces superior results.
He talked about how Berkshire earned a dividend of 704 Million USD last year from coca cola stocks having bought coca cola back in 1994 with an investment of 1.3B USD and has a market value of 25B USD right now.
He Mentions American Express and how they first invested 1.3 B USD in 1995, how the dividend income has grown from 41M USD to 302M USD in 2022, and current market cap is 22B USD.

The lesson for investors: The weeds wither away in significance as the flowers bloom.
Over time, it takes just a few winners to work wonders. And, yes, it helps to start early and live
into your 90s as well- Warren Buffett


Plz share the link you read Buffetts latter


A letter a day!

Day 2

Warren Buffett’s letter from the year 1958.

Key learnings:

  1. Giving due importance to intrinsic values while making decisions.

  2. Buffett explained that a reason for sharp gains in the market was mostly a display of exuberance i.e over excitement amongst market players.

  3. A point to note in this letter is " I make no attempt to forecast the general market - my efforts are devoted to finding undervalued securities".

  4. He clearly explains a portion of assets is still invested in securities whose prices will not be much impacted by the fast-rising market.

  5. If you are a fund manager here is a learning for you “. Very small buying orders can create price changes of high magnitude in an inactive stock, which explains the importance of not having any “Leakage” regarding our portfolio holdings.”

Please feel free to share your own learnings too.

A letter a day(WB1958)_Aashka Trivedi.pdf (155.0 KB)


I try to read all the letters once in year. it is amazing that I find something new every time i read it and it never bores me.

Here is my learning from letter 1958 :

  1. While it is impossible to determine how long they will continue to add numbers to their ranks and thereby stimulate rising prices, I believe it is valid to say that the longer their visit, the greater the reaction from it. - it is something like Newton’s 3rd law, for every action (force) in nature there is an equal and opposite reaction.

  2. Our performance, relatively, is likely to be better in a bear market than in a bull market so that
    Deductions made from the above results should be tempered by the fact that it was the type of
    year when we should have done relatively will. In a year when the general market had a
    substantial advance, I would be well satisfied to match the advance of the averages.- In stock market, “Not loosing” is more important than “Wining”.



A letter a day!

Letter#3 from 1959

Key learnings:

  1. In times of the bull market, it is preferable to use conservatism rather than preparing for the permanent loss of capital.

  2. One of the highest allocations in the portfolio reached 35%( Surprising, none of the allocations in my personal portfolio, even on the basis of market value has crossed 25%:joy:).

Feel free to share your learnings too.

If you want to read the full letter, attaching it here.

A letter a day(WB1959)_ Aashka Trivedi.pdf (150.3 KB)


Here are my 2 cents:

  • Even though you have selected good/great business at fair value - there will be time you will underperform the market - this is inevitable but this underperformance prepare for the good times so again back to yesterday’s learning. sometime this can be very painful.

I had one position which crossed 40% of my portfolio but it automatically came down by market correction (still more than 20%).


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Sharing link of Barkshire Hathaway letters to Shareholders from 1957 onwards :

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A letter a day!

Letter #4 from 1960

The letter is lengthy for 2 reasons

  1. Some technical client-specific questions have been answered.
  2. Explanation of the company with the highest allocation in the portfolio.

Key learnings:

  1. A point to note is the detailed and transparent disclosure of the company with the highest allocation. This will definitely give the clients a sense of confidence behind the conviction.

  2. Discussion regarding the performance of the portfolio. Buffett states that he would be happy in a year in which the portfolio has declined and the index has advanced rather than both advancing by the same %. ]

A letter a day(WB1960)_Aashka Trivedi.pdf (168.1 KB)


A letter a day

Letter #5 from 1960

Half-yearly letter

Key learnings:

  1. One year is far too short a period to form a kind of opinion as to investment performance and measurements based on 6 months become even more unreliable.

  2. Preferable test of performance should be 5 years in both strong and weak markets.

  3. At all times, have some portion of allocations in the company that is not impacted by immediate price movements and this portion should increase as the market advances.

  4. The adoption of skin in the game. Invest your personal money only in stocks in which you will put your client’s money. This way your result will be directly proportional to the client’s returns.

A letter a day(WB1960)HY_Aashka Trivedi.pdf (155.2 KB)


A letter a day.

Letter#6 1961

Key learnings

1.Buffett’s partnership firm has completed 5 years. Buffett has shown the performance of his fund with other mutual funds, investment trusts and dow jones industrial averages.

2.Just because something is cheap, it doesn’t mean it’s not going to go down.

3.Division of available stock opportunities into 3 types:

  1. Undervalued securities.( Largest position in this category, this category has made more money than any other category)

  2. Workouts. (Securities that can be predicted with time, can be identified what can go wrong. The high degree of safety in this section).

3.Control. ( Control the company by taking large positions and influencing the policies of the company) .

  1. You will not be right because many people agree with you. You will not be right simply because important people agree with you. You will be right, over the course of many transactions, if your hypotheses are correct, your facts are correct, and your reasoning is correct. True conservatism is only possible through knowledge and reason.

This letter is a very detailed one to understand Buffett’s style of investment how he classifies his stock under different heads and why is one sure thing to read and easy to implement too.


My learning from letter 1960:

  • Most people when hear about WB, they think about word – stock market, buy and sell, hold what they miss that what is underneath of this operation like Sanborn map where he had to acquired stake go on to board of the company and then face resistance from existing board member to change, acquired more stake and get things done. This is different and that’s why it will be very hard to replicate his records. In future, there are Saloman brother and newspaper investment which has its unique story.
  • Though he mentions that “Our bread-and-butter business is buying undervalued securities and selling when the undervaluation is corrected along with investment in special situations where the profit is dependent on corporate rather than market action” but his one third portfolio has been/is/will be in special situation (I have also included control in this one) and sometime more so just to knowing how to buy and sell in market – does not give us edge. In India, during 90’s this was slight advantage as it would take at minimum month, if not more, to just open trading/demat account. We need to bring something different to table in order to earn outsized returns.
  • Investment capital size matter; it has its own disadvantage and advantage like with more capital you can influence decision of company at the same time it would be hard to get investment opportunities which move needle to get sufficient return on invested capital.

@aashka_trivedi , I think you forgot to attach letter for 1961.


If anyone is interested in Buffett Partnership clauses/agreement. Thanks!
BPL Aggreement.docx (35.4 KB)

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A letter a day!

Letter 7#1962

This year’s letter is more about performance comparison with the mutual funds and the index. A good read for all the fund managers who need to communicate performance with the clients.

One key learning is a Short period of measurement exaggerates the chances of fluctuations in performance.

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A letter a day.

Letter 8 #1963

Key learnings:

  1. This is the 8th letter I read today. A commonality in all the letters which I have noticed till in the letters is the transparent way of communication. When Buffett is addressing his investors through letters, he is extremely straightforward regarding all the decisions and never shows a rosy picture. If we take an example from this letter, he said

“Our partnership’s fundamental reason for existence is to compound funds at a better-than-average rate with less exposure to long-term loss of capital than the above investment media. We certainly cannot represent that we will achieve this goal. We can and do say that if we don’t achieve this goal over any reasonable period excluding an extensive speculative boom, we will cease operation”.

I have been following a lot of good fund managers’ letters but have never come across this kind of bold statement of ceasing the operations on non-performance.

  1. Investment decisions should be made on the basis of the most probable compounding of after-tax net worth with
    minimum risk. Always consider the impact of taxation.

  2. Accepting advance money from the clients:

I don’t think any of the PMS houses follow this concept today or its relevance but it is interesting to read both the acceptance of advance payments and its withdrawals are at the same rate (6%). Why he does do so? He believes that rather than borrowing money from the banks, borrowing money from the clients at higher rates ( 4% rate if borrowed from the banks and 6% from partners) is advantageous to them since due to advance payments, investments options can be explored throughout the year rather than deploying them all at once. He also stated that in the longer term, they expect to earn better than 6%. On the withdrawals side, he looks at it as a means of giving some liquidity for unexpected needs. ( As on June 30, 1963, Buffett partnership had total advance withdrawals of $21,832.00 and advance payments of $562,437.11.)


This is a very good initiative and from a long time I was looking to read all his letters apart from my regular reading. Your learning points look ood and will motivate many to read these letters and jot down the learnings .