Core Viewpoint - Warren Buffett emphasizes the importance of portfolio concentration over diversification, arguing that true understanding and higher returns come from focusing on a smaller number of businesses [2][4]. Investment Philosophy - Buffett's investment philosophy encourages thinking like business owners rather than market traders, advocating for concentrated investments in high-quality companies with durable competitive advantages [3][4]. - He critiques "deworsification," which refers to adding investments that dilute overall performance without significantly reducing risk [3][5]. Performance and Track Record - Buffett's approach has been validated by his long-term track record as chairman and CEO of Berkshire Hathaway, where he has overseen compound annual growth in book value that far exceeds market averages [4]. - His reputation as the "Oracle of Omaha" is based on both his results and his ability to clearly explain financial principles [4]. Contrast with Modern Portfolio Theory - Buffett's stance contrasts with modern portfolio theory, which advocates for diversification to maximize returns for a given level of risk [5]. - He argues that if an investor has a limited amount of capital, it is more beneficial to invest in a few well-chosen stocks rather than spreading investments too thinly [5].