Saturday, April 21, 2012

Identifying Warren Buffett's Successor: Insights from Text Analytics

MarketPsych Data analyzed Berkshire Hathaway's shareholder letters to determine who is most likely to be Warren Buffett's successor.  Our results, and an excellent article about the project, appear in Jason Zweig's column in today's WSJ.

Using our software, which specifically detects emotive words and relationships, we identified the individuals who Warren Buffett referenced most positively in the Berkshire Hathaway shareholder letters from 1995-2011.  Our software scanned for emotional references related to liking, being pleased with performance, and affection (what we called "Super-Positive") and references of a generally positive nature (what we called "Positive").

For individuals with more than eight sentiment-associated mentions in the shareholder letters, these two were the most positively referenced:
DANNY GOLDMAN (Venture capitalist - formerly CFO at Iscar)

For individuals with more than four mentions but less than eight, these two stood out:
GRADY ROSIER (CEO of McLane Company)

So while we don't know who Buffett's successor will be with 100% accuracy, we do know that the above four individuals received high praise from Warren Buffett in his shareholder letters.

Check out for more information about our market-leading financial textual analysis research.

Happy Investing!
Richard. L. Peterson, M.D.

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