In 1969, Warren Buffett decided to close down his 100-member investment partnership and offered to return the money to the investors. However, for those who wanted to stay invested in stock market, Buffett advised them to take their cash to Sequoia Fund run by Bill Ruane.
Warren Buffett recognizes Ruane as one of the Superinvestors of Graham-and-Doddsville. He wrote, “When I wound up the Buffett Partnership, I asked Bill Ruane if he would set up a fund to handle all of our partners, so he set up the Sequoia Fund…Bill was the only person I recommended to my partners.”
Bill Ruane and Buffett knew each other from the time they studied under Benjamin Graham at Columbia University. Ruane was also Buffett’s stock broker in the 1960s.
Ruane is one of his generation’s most successful money managers. Sequoia fund has recorded one of the best long-term track records on Wall Street since its inception. In the 45-year period from its inception in 1970 to 2015, the fund earned an annualized return of 14.7% versus the S&P 500’s annualized return of 10.9%. It’s one of the very few funds which has managed to outperform the S&P 500 for four decades.
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