[oli5679]

Buffet's approach of combining high leverage with low growth 'value' equities is a large part of his great performance. This is not to say there isn't a skill in noticing the benefits of this approach and convincing creditors and investors to let you take on all the debt, but a surprisingly small proportion of these gains are due to stock picking.

http://xqdoc.imedao.com/150c22613c69373fe2602a80.pdf

[tim333]

Buffett actually has very little debt. Most of the leverage comes from insurance float - when you buy insurance with GEICO Buffett invests the money until you crash.

[oli5679]

True, should have written leverage rather than debt but the risk profile is the same for investors.

[kale]

Can anyone really know what the root of his great performance is? If anyone did, wouldn't they be as successful?

[oli5679]

Yes, the disaggregation used in the linked paper is robust. You're welcome to critique it if you find a specific error.

There are often leverage restrictions for financial products sold to individuals and even beyond this people are often wary of them. He is incredibly skillful in gaining the trust of investors and running an efficient mortgage operation as well as having a moderately good stock picking record.