Mary Buffett is the former daughter-in-law of Warren Buffett. The entrepreneur Ms Buffett – who has three adult children – studied her father-in-law's investment methods up close for 12 years while married to his youngest son, Peter, a musician and composer. She is writing her eighth book about the Oracle of Omaha's ways; the first, Buffettology, was published in 1997, co-written with David Clark. Here, she shares investment tips and her life story after speaking on Saturday at the Success Summit, at the Crowne Plaza Hotel in Dubai:
What was your first investment?
Warren would give us stocks at Christmas time as a gift. It sounds philanthropic but he didn’t have to pay tax on up to $10,000 per recipient. He gave us cash until he realised we just spent it. The first investment he gave us was in Coca-Cola, I think. Every year, every stock he gave us just kept going up. After that, whatever he gave us, I would buy more of it.
What was your early career?
I was a professional singer-songwriter in the studio with Phil Spector and then I was working with Columbia Records. By the time I was 19, I had landed a job as the managing director of Hugh Heffner’s music business companies. I met Peter through his sister and said I’d manage his career. We met at the end of 1979 and were married by 1981. I don’t think I would have been involved in finance and investment if it wasn’t for Warren; I was an entrepreneur at heart.
How did you learn Mr Buffett’s methods?
In 1980, no one really knew of Warren Buffett. I was fortunate; it was in that 13-year period he really made his biggest investments. The only thing I knew when I met Peter was that Warren owned Blue Chip Stamps and See's Candies. I couldn't help but learn: he's an intrinsic teacher. At his house in Omaha for the first time, I was upstairs looking at his library and he gave me Security Analysis (by Benjamin Graham and David Dodd and first published in 1934) to read. Re-reading each page four times, I got through it – then everything he talked about started making more and more sense.
Why did you start writing about his methods?
I divorced in 1993 and wound up a single mom back in Los Angeles, thinking “what am I going to do?” I don’t have Warren, I don’t have security. Peter’s attorney in divorce originally expected me to pay him support. I started writing a book for women in my situation. But while I had the qualitative analysis and psychology of Warren’s thinking, I didn’t have the quantitative ability to go through case studies of companies, so I called a friend, David Clark. It took us four years to write the first book.
What is the Warren Buffett method?
Buy companies that have consumer monopolies or are branded companies, that have great management. And have the discipline and patience to wait to buy them at the right price. Invest in what you know: that’s what Warren does. He knows consumer goods well – that people use them and have to buy them again.
What are your key investments today?
The majority of my portfolio is in Berkshire Hathaway. I believe the renewable sector – cleaner air and water, biofuels and solar power – is a really great investment. I’m constantly researching and reading, looking at different stocks. My portfolio has always been fairly small – fewer than 20 stocks.
Where is the market at today?
Bull markets tend to run longer and we’ve been in a bull market a long time. When recessions, corrections and bad news come, people tend to sell – that’s when the opportunity comes to buy.
How do you research a company?
Most of the companies in Warren’s portfolio are more than 100 years old. They have this great history and that’s what allows you to do analysis on the fundamentals. Are they sound? Do they have low debt? Can you reasonably predict what they will do in the future based on what they have done with their earnings in the past? How do they use their profits? Does the management have shareholders’ interests in mind? You’re buying a business, you’re not buying a stock, even if you’re buying one share.
How should people invest?
I tell my children to get in the habit of taking 10 to 15 per cent of every cheque they get and put it aside for investment. You don’t want to have more than 40 per cent of your portfolio in any particular stock. For those who don’t want to do the work, invest in an index fund like the S&P 500. It may not give a 20 per cent annual compound return but it will give between 8 and 10 per cent.
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AT4 Ultimate, as tested
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
Brief scores:
Southampton 2
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'My Son'
Director: Christian Carion
Starring: James McAvoy, Claire Foy, Tom Cullen, Gary Lewis
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Globalization and its Discontents Revisited
Joseph E. Stiglitz
W. W. Norton & Company
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The rules on fostering in the UAE
A foster couple or family must:
- be Muslim, Emirati and be residing in the UAE
- not be younger than 25 years old
- not have been convicted of offences or crimes involving moral turpitude
- be free of infectious diseases or psychological and mental disorders
- have the ability to support its members and the foster child financially
- undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
- A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
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