Warren Buffett Found Billions In A Tiny Japanese Guidebook He Could Barely Read — No Analysts, No Travel, Just Pure Instinct

At what will be his last annual meeting as CEO of Berkshire Hathaway, Warren Buffett shared a story that succinctly demonstrated his unique ability to spot value in unexpected places, like a small Japanese handbook he could barely read.

What Happened: Buffett's famous journey with the five Japanese trading houses — Itochu, Marubeni, Mitsubishi Corp., Mitsui & Co.and Sumitomo Corp. started not with a team of analysts or a visit to the country, but with a handbook detailing thousands of Japanese companies, according to CNBC.

"I was just going through a little handbook that probably had 2,000 or 3,000 Japanese companies in it," he recalled. In it, he discovered a group of companies that caught his attention. "One problem I have is that I can't read that handbook anymore. The print's too small. And there were these five trading companies. They have a special name for them in Japan, but they were selling at ridiculously low prices. So I spent about a year acquiring them."

Berkshire Hathaway now holds around 10% of each firm.

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Why It Matters: This handbook is the go-to source for Japan's everyday retail investors. Bloomberg reports that it is known as the Kaisha Shikiho, a quarterly guide regarded locally as the "bible of Japanese equities." For about ¥2,800 (approximately $20), investors get a comprehensive, encyclopedia-style volume full of data on almost 4,000 publicly traded companies across Japan.

The English edition of the Handbook has even appeared on Buffett's desk more than ten years ago. But surprisingly, the publisher discontinued the English version last year.

Highlighting the value of the handbook, Buffett said: "If you get real opportunities every five or six years…, you have to be patient." "Every now and then you get extraordinary opportunities, and most of the time you don't have much of an edge," he added.

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