We measure performance by intrinsic value.
Source: Berkshire Hathaway Letters · Valuation
Core Idea
Judge investments by their intrinsic value growth, not short-term market price swings, because true performance reflects long-term business fundamentals and owner earnings, not temporary investor sentiment.
Practical Application
Focus on buying businesses you understand, track their intrinsic value and owner earnings over years, and ignore price noise so your decisions reflect real long-term wealth creation.
Why It Matters
Real investment success comes from tracking the compounding of a business intrinsic value and owner earnings, not reacting to short-term market quotes or crowd-driven price volatility.