Warren Investment Tips
Buy into a company because you want to own it, not because you want the stock to go up..
Warren Buffett is a long-term investor, Berkshire Hathaway is a result of his long-term value investing principles
Risk comes from not knowing what you're doing.
In today's newsletter, I’m listing Buffet investment tips that could be beneficial to any investor
Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it.
Hang out with people better than you, and you’ll drift in that direction.
Buy companies with strong history of profitability and with a dominant business franchise
On selecting companies worth investing, here's what Buffett suggests.
It’s better to buy a wonderful company at a fair price than a fair company at a wonderful price.
A truly great business must have an enduring moat that protects excellent returns on invested capital.
Never invest in a business you can't understand.
Don’t look at the aspects of the stock, look at the aspects of the business
Buffett on fear which is known to investors as volatility index.
I like buying quality stocks when it's marked down.
When investing, pessimism is your friend, euphoria the enemy.
A climate of fear is an investors friend.
Ignore political and economic forecasts, they're expensive distractions for many investors and businessmen.
A true investor welcomes volatility, this is because a wildly fluctuating market means that irrationally low prices will periodically be better attached to solid business.
Buffett on the stock market:
The stock market is an auction market and crazy things can happen.
When people get fearful, they get fearful en masse. When they get greedy, they get greedy en masse.
Stocks are good if you buy in at appropriate prices.
Investment in stocks is an investment in businesses.
It's a mistake paying attention to the day to day fluctuations of a stock, it makes no difference.
The dumbest reason to buy a stock is because it's going up.
Buffett on predicting the economy or market.
If past history was all that's required in the game of investing, the richest people would be librarians.
Market forecasters will fill your ear but never fill your wallet.
Don't try to figure out what the market is doing, figure out a business you understand and concentrate.
If you try to time your purchases, you will do very well for your broker and not very well for yourself.
Pick great companies with dominant positions, whose franchise is hard to duplicate and has a tremendous staying power.
Buffett on IQ in investing.
Success in investing doesn't correlate with IQ. Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people in trouble when investing.
Losing some money is an inevitable part of investing and there’s nothing you can do to prevent it.
Buffett on safety when investing.
You can't precisely know what a stock is worth, so leave yourself a margin of safety. Only go into things where you could be wrong to some extent and come out OK.
The stock doesn't know you own it. You have feelings about it, but it has no feelings about you. The stock doesn't know what you paid.
People shouldn't get emotionally involved with their stocks.
Here's a guideline Warren Buffett suggests for any investor. It has worked well for him
“Your goal as an investor should simply be to purchase at a rational price, a paid interest in an easily understandable business whose earnings are virtually certain to be materially higher ten and twenty years from now. So when you see a business that qualifies, you should buy a meaningful amount of stock. You must also resist the temptations to stray from your guideline.”
Put together a portfolio of companies whose aggregate earnings march upward over the years and so will the portfolios market value.
The ability to say “NO” is a tremendous advantage for an investor.
If you don't make good decisions, your investments wouldn't be successful.
Are there other tips that can help an investor make the right decisions?
Share your opinion in the comments
This is very informative.