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Thanks Sandman, LiveFromHopkins and Shai. Delightful video/audio.

Mr. Buffett's comments on diversification were interesting; I hadn't heard him talk about 6/50% before. Here's what I jotted when I watched the video (I think this was a little after one hour) - the transcription may be erroneous in spots:

"The question is about diversification, and I've got a dual answer to that. If you are not a professional investor, if your goal is not to manage money in such a way as to get a significantly better return than the world, then I believe in extreme diversification. So I believe 98 or 99 percent, maybe more than 99 percent, of people who invest should extensively diversify and not trade, so that leads them to an index fund-type of decision with very low cost. Because all they're going to do is own a part of America, and they've made a decision that owning a part of America is worthwhile. I don't quarrel with that at all. That is the way they should approach it, unless they want to bring an intensity to the game to make a decision and start evaluating businesses.

"But once you're in the business of evaluating businesses and you decide that you're going to bring the effort and intensity and time involved to get that job done, then I think that diversification is a terrible mistake to any degree. I got asked that question when I was at Sun Trust the other day and: If you really know businesses, you probably shouldn't own more than 6 of them. I mean, if you can identify 6 wonderful businesses, that is all the diversification you need, and you're going to make a lot of money and I will guarantee you that going into a seventh one, rather than putting more money in your first one, is gotta be a terrible mistake. Very few people have gotten rich on their seventh best idea. But a lot of people have gotten rich on their best idea. So I would say that for anybody working with normal capital who really knows the businesses they've gone into, 6 is plenty, and I'd probably have half of it in what I liked best.

"I don't diversify personally. All the people I know that have done well, with the exception, we've mentioned Walter Schloss here, Walter diversifies a lot, he owns a little of everything. I call him Noah: you know, he's got two of everything."
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