Warren Buffett often uses analogies from different sports to make a point about the type of opportunities he looks for. A fat pitch is a pitch in baseball where everything is just right to hit it for a home run. Nothing makes us swing at any particular pitch. We just wait until everything is in our favor. Similarly, a fat pitch in investing is where everything is just right for the investment. Everything stacks up for it to be a great company selling at a profitable price.
Here are some quotes from Buffett with a sports theme starting with one on fat pitches.
?As I?ve said before, you wait for the fat pitch. Ted Williams wrote about that in a book called The Science of Hitting. He said the most important thing in being a good hitter is to wait for the pitch in the sweet spot.? (Annual Meeting in 2003; OID XVIII, 3 & 4, p.43)
"We try to exert a Ted Williams kind of discipline. In his book The Science of Hitting, Ted explains that he carved the strike zone into 77 cells, each the size of a baseball. Swinging only at balls in his "best" cell, he knew would allow him to bat .400; reaching for balls in his "worst" spot, the low outside corner of the strike zone, would reduce him to .230. In other words, waiting for the fat pitch would mean a trip to the Hall of Fame; swinging indiscriminately would mean a ticket to the minors." (Berkshire Hathaway Annual Report, 1997)
"In investments, there?s no such thing as a called strike. You can stand there at the plate and the pitcher can throw a ball right down the middle, and if it?s General Motors at 47 and you don?t know enough to decide on General Motors at 47, you let it go right on by and no one?s going to call a strike. The only way you can have a strike is to swing and miss." (Warren Buffett Talks Business, The University of North Carolina Center for Public Television, Chapel Hill, 1995)
?I love what I do. I?m involved in a kind of intellectually interesting game that isn?t too tough to win, and Berkshire Hathaway is my canvas. I don?t try to jump over seven-foot bars; I look around for one-foot bars that I can step over.? (New York Times Magazine, L.J. Davis, April 2, 1990)
?To swim a fast 100 meters, it?s better to swim with the tide than to work on your stroke.? (Annual Meeting in 1991)
?The important thing we do as managers generally is to find the .400 hitters and then not tell them how to swing? And the second thing we do is allocate capital. Aside from that we play bridge. That's Berkshire.? (Annual Meeting in 1994)
?There are a lot of profitable things that you can do but you have to stick to what you can do. We can?t find a way to knock out Mike Tyson.? (Annual Meeting in 1991)
