How Can You Begin Investing Between the Lines?

What can we learn about investing between the lines?What do these two incredible investors know about investing between the lines?

I’m getting ready for another exciting Berkshire Hathaway annual meeting this weekend in Omaha! It’s the first where I get to help my investing clients get a better handle on what’s happening at Berkshire Hathaway and the business world overall. Warren Buffett and Charlie Munger will be holding court and it should be an exciting opportunity to hear what they think. You’ll see why they are very good at Investing Between the Lines!

I became part of the Berkshire Hathaway family in 1986 when they bought a mentor’s business; Scott & Fetzer. There is an irony here, I’m part of my longest term client because I sold Kirby Vacuums  door to door in the mid-eighties.

Every year when the Berkshire annual event comes up, I get asked by my clients both inside and outside the organization what I’ve learned from this annual event. Every year its something old and something new. One thing for certain it’s always entertaining and informative.

I thought it might be fun to share a resource that I recently discovered that can help you better understand why I enjoy this annual event so much. The book is called Investing Between the Lines by L.J. Rittenhouse. It a great guide to help investors make better decisions on their investments by learning how to speak CEO.

I wish I would have had this book many years ago when I started my investing career. It could have saved me many years of hard work to define how CEO leadership and communications can give you an inside look at the companies you invest in.

Investing Between the Lines provides many usable strategies on better understanding the mind of a successful CEO. The book helps you make smarter decisions by decoding CEO communications. The author, L.J Rittenhouse, provides many different examples of how to discern what a CEO means from what the CEO says. She does this through ample examples featuring Warren Buffett and Charlie Munger.

L.J. Rittenhouse has discovered a correlation between great CEOs and their ability to communicate effectively with their many stakeholders. She has also discovered that CEOs who put trust as the critical element in their communications build great companies. These CEOs focus on how candor and culture make them more successful in how they lead their organizations.

In Investing Between the Lines, Laura creates a framework to help us better understand what it takes to create an extraordinary business. Her ideas are like old friends for people who attend the Berkshire Hathaway annual meeting. We’ve seen these values displayed on the platform for many years at the annual events. What makes it more relevant today is how it plays out in the many different companies inside the organization throughout the year.

The Rittenhouse Rankings provides a great tool for leaders to evaluate their organization against, as well a stringent framework that investors can use to evaluate different aspects of how the business is being lead. A critical element in your long term investing success strategy.

Their mission statement sets a clear expectation for their clients and investments. Their mission statement is We work with CEOs and CFOs to create Accountability Cultures that sharpen Execution, grow Trust and achieve Financial Leadership.”  As you can imagine this sets a high standard for leaders.

Investing Between the Lines provides you a framework to help investors better understand the critical success factors inside successful organizations and their leaders. Laura covers a wide range of topics.  The book has a no BS style while providing examples and questions that help you become a better investor. Her candor is refreshing in a world of soundbites and fluff that drives many investors crazy.

Laura provides you with many different evaluations of leading CEOs in different industries. She shares different examples for you to begin seeing the patterns of behavior from both good and bad CEOs’ performances. The quality of an organization’s leadership is the number one criteria that Warren and Charlie uses when making an acquisition.

The book is easy to understand if not as easy to describe in this limited format. Fear not, I thought it might be easier and more interesting to see the framework in action.  I decided to use it for this year’s Berkshire Hathaway  Annual meeting.

I understand that I can’t possibly cover all the components from this single event so I will choose which to use during the event. I’ll let Charlie and Warren be my guide to what you might find most interesting from the annual meeting. The extended question and answer period have provided many great ideas and insights over the years.

Since the book is new to me as well, I believe I can show you why I will be giving it to my clients over the coming years. I believe its an incredible resource for the informed investor.

See you next week.

Be the first to comment on "How Can You Begin Investing Between the Lines?"

Leave a comment