I have made plenty of mistakes in acquisitions and will make more.
There are two interesting aspects of the investing profession that can be compared, in different ways, to sports.
One is that, like sports, the greatest investors are correct only some of the time. The best batters in the history of baseball get base hits maybe 30% of the time, and the best investors make correct investment decisions maybe 60% of the time. This is in contrast to many other professions where a high failure rate would result in catastrophe instead of success.
Further, like baseball, investing is at heart a slugging percentage endeavor — what really matters is the magnitude of the correct calls vs the number of correct calls, versus the magnitude of the incorrect calls. A successful investor can be wrong much of the time as long as her successful calls generate large returns.
Second, unlike sports, where professional athletes typically can’t play past their 30’s or early 40’s, great investors who keep working hard can keep getting better and better well into their 80’s — like Buffett.
To help improve the meaning of these lyrics, visit “Letter To Shareholders 2012” by Warren Buffett and leave a comment on the lyrics box