Develop a Search Strategy 87These are good companies, and yet they ’ re cheap. The stocks
have gotten cheaper than five years ago, and yet the businesses
are more valuable.... They make basic products like steel and
cement and flour and electricity, which people will still be buy-
ing in ten years. They have a big market share in Korea which
isn ’ t going to change, and some of these companies are export-
ing to China and Japan too.... I could end up with nothing
but a bunch of Korean securities in my personal portfolio.
The main risk, and part of why the stocks are cheap, is North
Korea. And North Korea is a real threat.... But I would make
the bet that the rest of the world, including China and Japan,
are simply not going to let the situation get to the point that
North Korea makes a nuclear attack on South Korea anytime
soon.
When you invest, you have to take some risk. The future
is uncertain. I think a group of these stocks will do very well
for several years.... I could end up owning them for several
years.^9Read, Read, Read
There was no secret trick to Buffett ’ s success in Korea. He simply
put pen to paper and took the necessary time to satisfy his objec-
tives. And above all, he continued to read and read until he had
developed a satisfactory core competency to invest in South Korea.
Reading, and lots of it, is the fi nal clue to a successful search
strategy. When you fi nd a company you like, don ’ t just read the lat-
est annual report. Go back and read the annual reports for several
years. Assess what the business was like then, and evaluate manage-
ment ’ s goals and objectives then. Did they accomplish, exceed, or
fail to meet those objectives? Read the annual reports of competi-
tors. You may discover that your initial idea has led to an even betterCH005.indd 87CH005.indd 87 9/2/09 11:08:08 AM9/2/09 11:08:08 AM