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Buffett Partnership Letters 1957 to 1970
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www.csinvesting.wordpress.com studying/teaching/investing Page 67
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BUFFETT PARTNERSHIP, LTD.
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810 KIEWIT PLAZA
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OMAHA 31, NEBRASKA
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January 18, 1965
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Our Performance in 1964
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Although we had an overall gain of $4,846,312.37 in 1964, it was not one of our better years as judged by our
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fundamental yardstick, the Dow-Jones Industrial Average (hereinafter called the "Dow"). The overall result for
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BPL was plus 27.8% compared to an overall plus 18.7% for the Dow. The overall result for limited partners was
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plus 22.3%. Both the advantage of 9.1 percentage points on a partnership basis and 3.6 points by the limited
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partners were the poorest since 1959, which was a year of roughly comparable gains for the Dow.
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Nevertheless, I am not depressed. It was a strong year for the general market, and it is always tougher for us to
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outshine the Dow in such a year. We are certain to have years when the Dow gives us a drubbing and, in some
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respects, I feel rather fortunate that 1964 wasn't the year. Because of the problems that galloping markets pose
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for us, a Dow repeat in 1965 of 1964 results would make it most difficult for us to match its performance, let
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alone surpass it by a decent margin.
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To bring the record up to date, the following summarizes the year-by-year performance of the Dow, the
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performance of the Partnership before allocation to the general partner, and the limited partner's results:
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Year Overall Results From
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Dow (1)
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Partnership Results (2) Limited Partners’
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Results (3)
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1957 -8.4% 10.4% 9.3%
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1958 38.5% 40.9% 32.2%
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1959 20.0% 25.9% 20.9%
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1960 -6.2% 22.8% 18.6%
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1961 22.4% 45.9% 35.9%
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1962 -7.6% 13.9% 11.9%
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1963 20.6% 38.7% 30.5%
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1964 18.7% 27.8% 22.3%
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(1) Based on yearly changes in the value of the Dow plus dividends that would have been received through
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ownership of the Dow during that year. The table includes all complete years of partnership activity.
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(2) For 1957-61 consists of combined results of all predecessor limited partnerships operating throughout
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the entire year after all expenses, but before distributions to partners or allocations to the general
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partner.
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(3) For 1957-61 computed on the basis of the preceding column of partnership results allowing for
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allocation to the general partner based upon the present partnership agreement, but before monthly
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withdrawals by limited partners.
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On a cumulative or compounded basis, the results are:
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Year Overall Results From
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Dow
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Partnership Results Limited Partners’
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Results
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1957 -8.4% 10.4% 9.3%
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1957 – 58 26.9% 55.6% 44.5%
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