Mohnish Pabrai Mimics Buffett and Munger

“Before starting my own investment funds, the only models I was aware of were those of Warren Buffett and Charlie Munger. Their models made a lot of sense to me, so I cloned them,” says investor Mohnish Pabrai in an interview with Forbes.

The article says Pabrai has beaten the stock market by triple-digits, but the businessman and philanthropist argues that his success is “nothing unexpected or surprising.” In his twenties, while an undergraduate engineering student, Pabrai found that business classes came exceedingly easy to him. “About ten years later,” he recalls, “as an engineer running an IT company, I found out about Warren Buffett quite randomly while reading a book by Peter Lynch” after which found his “true calling” and began creating investment partnerships.

Part of his professional journey, says Pabrai, was discovering that Buffett’s and Munger’s “rules were not random. Rather, they were thought through intensely.” One of those rules, he points out, is not to engage analysts. “Having analysts,” he says, “means you are missing out on learning about the businesses you are investing in.”

Pabrai does emphasize, however, that investors should determine their own preferences and tendencies before subscribing to an approach. He argues that not everyone is built to practice the Buffett/Munger style of investing. “Warren and Charlie have an intense passion for reading and learning new things. If that is also a part of your intrinsic personality, then you are on the right path following Warren and Charlie. It is not a path for everyone, but people can certainly pick up great habits to align with their approach.”