Buffett Investing Quotes

We've searched our database for all the quotes and captions related to Buffett Investing. Here they are! All 200 of them:

Be Fearful When Others Are Greedy and Greedy When Others Are Fearful
Warren Buffett
It's nice to have a lot of money, but you know, you don't want to keep it around forever. I prefer buying things. Otherwise, it's a little like saving sex for your old age.
Warren Buffett
Games are won by players who focus on the playing field –- not by those whose eyes are glued to the scoreboard.
Warren Buffett
Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble
Warren Buffett
The most important investment you can make is in yourself.
Warren Buffett
I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.
Warren Buffett
If you aren't thinking about owning a stock for ten years, don't even think about owning it for ten minutes.
Warren Buffett
Investors should be skeptical of history-based models. Constructed by a nerdy-sounding priesthood using esoteric terms such as beta, gamma, sigma and the like, these models tend to look impressive. Too often, though, investors forget to examine the assumptions behind the models. Beware of geeks bearing formulas.
Warren Buffett
I try to invest in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.
Warren Buffett
Never depend on single income. Make investment to create a second source.
Warren Buffett
Warren Buffett said that he would not invest in any business where the owner hasn’t failed at least twice. I love that truly wealthy and successful people understand that failure is part of the process.
Steve Harvey (Act Like a Success, Think Like a Success: Discovering Your Gift and the Way to Life's Riches)
The key to investing is not assessing how much an industry is going to affect society, or how much it will grow, but rather determining the competitive advantage of any given company and, above all, the durability of that advantage.4 —Warren Buffett
Mohnish Pabrai (The Dhandho Investor: The Low-Risk Value Method to High Returns)
The rich invest in time, the poor invest in money.
Warren Buffett
Only when the tide goes out do you discover who's been swimming naked.
Warren Buffett (Warren Buffett Speaks)
price is what you pay; value is what you get.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
On the Ideal Business - Buffett: “Something that costs a penny, sells for a dollar and is habit forming.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
On me personally what has been the most important was to understand the value of time -- and this is something that has come from observing him, learning his story and that time compounds. What you do when you are young (and as you use time over your life) can have an exponential effect so that if you are thoughtful about it, you can really have powerful results later, if you want to. Also, that is a reason to be hopeful, because compounding is something that happens pretty quickly. If you are 50 or 60, it is not too late. He said to me one time, if there is something you really want to do, don't put it off until you are 70 years old. ... Do it now. Don't worry about how much it costs or things like that, because you are going to enjoy it now. You don't even know what your health will be like then. On the other hand, if you are investing in your education and you are learning, you should do that as early as you possibly can, because then it will have time to compound over the longest period. And that the things you do learn and invest in should be knowledge that is cumulative, so that the knowledge builds on itself. So instead of learning something that might become obsolete tomorrow, like some particular type of software [that no one even uses two years later], choose things that will make you smarter in 10 or 20 years. That lesson is something I use all the time now.
Alice Schroeder (The Snowball: Warren Buffett and the Business of Life)
Buffett's methodology was straightforward, and in that sense 'simple.' It was not simple in the sense of being easy to execute. Valuing companies such as Coca-Cola took a wisdom forged by years of experience; even then, there was a highly subjective element. A Berkshire stockholder once complained that there were no more franchises like Coca-Cola left. Munger tartly rebuked him. 'Why should it be easy to do something that, if done well two or three times, will make your family rich for life?
Roger Lowenstein (Buffett: The Making of an American Capitalist)
If you are investing in your education and you are learning, you should do that as early as you possibly can, because then it will have time to compound over the longest period. And that the things you do learn and invest in should be knowledge that is cumulative, so that the knowledge builds on itself. So instead of learning something that might become obsolete tomorrow, like some particular type of software [that no one even uses two years later], choose things that will make you smarter in 10 or 20 years.
Warren Buffett
Buffett pointed out that when the investment tide goes out, you will see who has been swimming naked.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
You can’t make a good deal with a bad person.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Finding the next Warren Buffett is like looking for a needle in a haystack. We recommend that you buy the haystack instead, in the form of a low-cost index fund.
Burton G. Malkiel (The Elements of Investing: Easy Lessons for Every Investor)
Our favorite holding period is forever. We are just the opposite of those who hurry to sell and book profits when companies perform well but who tenaciously hang on to businesses that disappoint. Peter Lynch aptly likens such behavior to cutting the flowers and watering the weeds.
Warren Buffett (Berkshire Hathaway Letters to Shareholders)
On traditional economic theory: We do not play chess as if we were a grandmaster, invest as if we were Warren Buffett, or cook like an Iron Chef. It is more likely we cook like Warren Buffett, who loves to eat at Dairy Queen.
Richard H. Thaler
Eighty-five percent of small businesses in this country fail within the first two years. Eight-five percent! That’s a whole lot of failure. Warren Buffett said that he would not invest in any business where the owner hasn’t failed at least twice. I love that truly wealthy and successful people understand that failure is part of the process.
Steve Harvey (Act Like a Success, Think Like a Success: Discovering Your Gift and the Way to Life's Riches)
Buffett's uncommon urge to chronicle made him a unique character in American life, not only a great capitalist but the Great Explainer of American capitalism. He taught a generation how to think about business, and he showed that securities were not just tokens like the Monopoly flatiron, and that investing need not be a game of chance. It was also a logical, commonsensical enterprise, like the tangible businesses beneath. He stripped Wall Street of its mystery and rejoined it to Main Street -- a mythical or disappearing place, perhaps, but one that is comprehensible to the ordinary American.
Roger Lowenstein (Buffett: The Making of an American Capitalist)
Despite our policy of candor, we will discuss our activities in marketable securities only to the extent legally required. Good investment ideas are rare, valuable and subject to competitive appropriation just as good product or business acquisition ideas are.
Warren Buffett (Berkshire Hathaway Letters to Shareholders)
Warren Buffett wisely stated, “The rich invest in time; the poor invest in money.
Elizabeth Grace Saunders (The 3 Secrets to Effective Time Investment: Achieve More Success with Less Stress)
Too often, a vast collection of possessions ends up possessing its owner.
Warren Buffett
The danger of relying on historical statistics or formulas is that you end up betting on a 14-year-old horse with a great record but is now ready for the glue factory.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
Buffett gave two criteria for evaluating the performance of management: 1) How well do they run the business? and 2) How well do they treat the owners?
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
Yet the industry asks for more money from investors every year. The idea is to find investments that give you money, not take it.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
Conscious learning becomes unconscious knowledge, and you cannot say precisely how.
Danielle Town (Invested: How Warren Buffett and Charlie Munger Taught Me to Master My Mind, My Emotions, and My Money (with a Little Help from My Dad))
Rule 1: don’t lose money. Rule 2: see Rule 1. —WARREN BUFFETT’S RULES OF INVESTING
Anthony Robbins (MONEY Master the Game: 7 Simple Steps to Financial Freedom)
What counts for most people in investing is not how much they know, but rather how realistically they define what they don't know.
Lawrence A. Cunningham (The Essays of Warren Buffett: Lessons for Corporate America)
Being able to think and invest very long term and not worry about current earnings or Wall Street analysts can be a major competitive advantage in certain businesses. Acquire
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
In the business world, the rearview mirror is always clearer
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Honesty is a very expensive gift. Don’t expect it from cheap people.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Time is the friend of the wonderful company, the enemy of the mediocre.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
The best education you can get is investing in yourself. But this doesn’t always mean college or university.” In
George Ilian (Warren Buffett: The Life and Business Lessons of Warren Buffett)
No business has ever failed with happy customers. You are selling happiness.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Common sense is the heart of investing and business management.
Lawrence A. Cunningham (How to Think Like Benjamin Graham and Invest Like Warren Buffett)
To make big money in the investment world you have to learn to think independently; to think independently you need to be comfortable standing alone.
Mary Buffett (The Tao of Warren Buffett: Warren Buffett's Words of Wisdom: Quotations and Interpretations to Help Guide You to Billionaire Wealth and Enlightened Business Management)
There are certain things that cannot be adequately explained to a virgin either by words or pictures.
Alice Schroeder (The Snowball: Warren Buffett and the Business of Life)
These people did not seem to learn from their mistakes. Everyone looked like a genius when the market was going up, but when it dropped, the depth of their ignorance was exposed
Danielle Town (Invested: How Warren Buffett and Charlie Munger Taught Me to Master My Mind, My Emotions, and My Money (with a Little Help from My Dad))
According to George Soros, what’s important is not whether you’re right or wrong about the market. What’s important is how much money you make when you’re right about a trade, and how much money you lose when you’re wrong.
Mark Tier (The Winning Investment Habits of Warren Buffett & George Soros: Harness the Investment Genius of the World's Richest Investors)
In modern portfolio theory, beta is used as a measure of the volatility and, thus, the risk of an investment. However, Buffett sees the use of beta as nonsense, emphatically stating, “Volatility is no measure of risk to us.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
Buffett also noted that book value is seldom meaningful in analyzing the value of a business. Book value simply records what was put into the business. The key to calculating value is determining what will come out of the business.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
occasional outbreaks of those two super-contagious diseases, fear and greed, will forever occur in the investment community. The timing of these epidemics will be unpredictable. And the market aberrations produced by them will be equally unpredictable, both as to duration and degree. Therefore, we never try to anticipate the arrival or departure of either disease. Our goal is more modest: we simply attempt to be fearful when others are greedy and to be greedy only when others are fearful. As
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
Buffett is known for thinking carefully when those around him lose their heads. “Success in investing doesn’t correlate with IQ,” he has said. “Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing.
Susan Cain (Quiet: The Power of Introverts in a World That Can't Stop Talking)
Buffett explained that buying a business is much like buying a bond with no maturity and with a blank coupon. You must write in the coupon, and the accuracy of that coupon is the essence of intelligent investing. If you cannot guess the coupon with any accuracy, then do not invest in the business.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
We will not go into businesses where technology which is way over my head is crucial to the investment decision. I know about as much about semi-conductors or integrated circuits as I do of the mating habits of the chrzaszcz. (That’s a Polish May bug, students—if you have trouble pronouncing it, rhyme it with thrzaszcz.) Furthermore,
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
Your goal as an investor should be simply to purchase, at a rational price, a part interest in an easily understood business whose earnings are virtually certain to be materially higher, five, ten, and twenty years from now. Over time, you will find only a few companies that meet those standards-so when you see one that qualifies, you should buy a meaningful amount of stock.
Robert G. Hagstrom (The Warren Buffett Way: Investment Strategies of the World's Greatest Investor)
Warren Buffett, chairman of Berkshire Hathaway and investor of legendary repute: "Most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that charges minimal fees. Those following this path are sure to beat the net results (after fees and expenses) delivered by the great majority of investment professionals.
Taylor Larimore (The Bogleheads' Guide to Investing)
Burry did not think investing could be reduced to a formula or learned from any one role model. The more he studied Buffett, the less he thought Buffett could be copied; indeed, the lesson of Buffett was: To succeed in a spectacular fashion you had to be spectacularly unusual. “If you are going to be a great investor, you have to fit the style to who you are,” Burry said. “At one point I recognized
Michael Lewis (The Big Short: Inside the Doomsday Machine)
Warren Buffett, the “Sage of Omaha” whose shrewd investments have made him one of the world’s richest men, has a stake in the marijuana industry via Cubic Designs, a company that provides mezzanine floor-space for warehouses. Cubic Designs dropped flyers off at 1,000 marijuana dispensaries, urging them to “double your growing space,” with a picture of metal flooring loaded with cannabis plants. The Sage himself made no comment.
Tom Wainwright (Narconomics: How to Run a Drug Cartel)
The results of these [investment] companies in some ways resemble the activity of a duck sitting on a pond. When the water (the market) rises, the duck rises; when it falls, back goes the duck. … I think the duck can only take the credit (or blame) for his own activities. The rise and fall of the lake is hardly something for him to quack about. The water level has been of great importance to BPL’s performance … however, we have also occasionally flapped our wings.”5 While
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
Living frugally even when you can afford to live luxurious will not only help you to save money. It will also help you to realize what is truly important in life. The secret that Warren Buffett knows is that money truly cannot buy you happiness. It can buy you a sense of security and it can open many doors for you. However, happiness comes from being engaged in fulfilling work; from strengthening your relationships with those who are most important to you; from doing those things that make you happy.
Tatyana Williams (WARREN BUFFETT Top Life Lessons: Warren Buffett Lessons for Unlimited Success in Business, Investing and Life! Warren Buffett (Warren Buffett, Warren Buffett ... Warren Buffett Investing, Warren Buffett))
The strategy we’ve adopted precludes our following standard diversification dogma. Many pundits would therefore say the strategy must be riskier than that employed by more conventional investors. We disagree. We believe that a policy of portfolio concentration may well decrease risk if it raises, as it should, both the intensity with which an investor thinks about a business and the comfort-level he must feel with its economic characteristics before buying into it. In stating this opinion, we define risk, using dictionary terms, as “the possibility of loss or injury.” —Warren Buffett, 19931
Allen C. Benello (Concentrated Investing: Strategies of the World's Greatest Concentrated Value Investors)
Warren Buffett, the legendary investor and one of the wealthiest men in the world, has used exactly the attributes we’ve explored in this chapter—intellectual persistence, prudent thinking, and the ability to see and act on warning signs—to make billions of dollars for himself and the shareholders in his company, Berkshire Hathaway. Buffett is known for thinking carefully when those around him lose their heads. “Success in investing doesn’t correlate with IQ,” he has said. “Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing.
Susan Cain (Quiet: The Power of Introverts in a World That Can't Stop Talking)
Charles Munger, right-hand adviser to Warren Buffett, the richest man on the planet, is known for his unparalleled clear thinking and near-failure-proof track record. How did he refine his thinking to help build a $3 trillion business in Berkshire Hathaway? The answer is “mental models,” or analytical rules-of-thumb4 pulled from disciplines outside of investing, ranging from physics to evolutionary biology. Eighty to 90 models have helped Charles Munger develop, in Warren Buffett’s words, “the best 30-second mind in the world. He goes from A to Z in one move. He sees the essence of everything before you even finish the sentence.
Timothy Ferriss (The 4-Hour Body: An Uncommon Guide to Rapid Fat-Loss, Incredible Sex, and Becoming Superhuman)
Basically, Graham breaks the art of investing down into two simple variables – price and value. Value is what a business is worth. Price is what you have to pay to get it. Given the stock market’s manic-depressive behavior, numerous occasions arise where a business’ market price is distinctly out of line with its true business value. In such instances, an investor may be able to purchase a dollar of value for just 50 cents. Note that there is no mention here of interest rates, economic forecasts, technical charts, market cycles, etc. The only issues are price and value. I should also note that Graham emphasizes a large margin of safety. The strategy is not to buy a dollar of value for 97 cents. Rather, the gap should be dramatic so as to absorb the effects of miscalculation and worse-than-average luck.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
Ben Graham told a story forty years ago that illustrates why investment professionals behave as they do. An oil prospector, moving to his heavenly reward, was met by St. Peter with bad news. “You’re qualified for residence,” said St. Peter, “but, as you can see, the compound reserved for oil men is packed. There’s no way to squeeze you in.” After thinking a moment, the prospector asked if he might say just four words to the present occupants. That seemed harmless to St. Peter, so the prospector cupped his hands and yelled, “Oil discovered in hell.” Immediately, the gate to the compound opened and all of the oil men marched out to head for the nether regions. Impressed, St. Peter invited the prospector to move in and make himself comfortable. The prospector paused. “No,” he said, “I think I’ll go along with the rest of the boys. There might be some truth to that rumor after all.” —WARREN BUFFETT, 1985
Tren Griffin (Charlie Munger: The Complete Investor)
Buffett declared the best inflation hedge is a company with a wonderful product that requires little capital to grow. As a test, he invited each of us to look at our own earning ability. In inflation, your compensation can go up without any additional investment. As a business example, Buffett noted that when See’s Candy was purchased in 1971, it had the revenues of $25 million and sold 16 million pounds of candy annually with $9 million in tangible assets. Today, See’s sells $300 million of candy with $40 million of tangible assets. Berkshire needed to invest only $31 million to generate a more than 10-fold increase in revenues. In aggregate, Buffett noted that Berkshire has earned $1.5 billion in profits at See’s over the years. See’s inventory turns fast, has no receivables and has little fixed investment – a perfect inflation hedge. Buffett allowed that if you have tons of receivables and inventory, that’s a lousy business in inflation. The railroad and MidAmerican Energy both have these undesirable characteristics, but that is offset by their utility to the economy and subsequent allowable returns. Buffett rued that there simply aren’t enough “See’s Candys” to buy. Buffett added that being an investor has made him a better businessman and that being a businessman has made him a better investor.(125) Munger noted that they didn’t always know this inflation-business element, which shows how continuous learning is so important.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
The Keoughs were wonderful neighbors,” he said. “It’s true that occasionally Don would mention that, unlike me, he had a job, but the relationship was terrific. One time my wife, Susie, went over and did the proverbial Midwestern bit of asking to borrow a cup of sugar, and Don’s wife, Mickie, gave her a whole sack. When I heard about that, I decided to go over to the Keoughs’ that night myself. I said to Don, ‘Why don’t you give me twenty-five thousand dollars for the partnership to invest?’ And the Keough family stiffened a little bit at that point, and I was rejected. “I came back sometime later and asked for the ten thousand dollars Clarke referred to and got a similar result. But I wasn’t proud. So I returned at a later time and asked for five thousand dollars. And at that point, I got rejected again. “So one night, in the summer of 1962, I started heading over to the Keough house. I don’t know whether I would have dropped it to twenty-five hundred dollars or not, but by the time I got to the Keough household, the whole place was dark, silent. There wasn’t a thing to see. But I knew what was going on. I knew that Don and Mickie were hiding upstairs, so I didn’t leave. “I rang that doorbell. I knocked. Nothing happened. But Don and Mickie were upstairs, and it was pitch-black. “Too dark to read, and too early to go to sleep. And I remember that day as if it were yesterday. That was June twenty-first, 1962. “Clarke, when were you born?” “March twenty-first, 1963.” “It’s little things like that that history turns on. So you should be glad they didn’t give me the ten thousand dollars.
Alice Schroeder (The Snowball: Warren Buffett and the Business of Life)
More than 2,000 books are dedicated to how Warren Buffett built his fortune. Many of them are wonderful. But few pay enough attention to the simplest fact: Buffett’s fortune isn’t due to just being a good investor, but being a good investor since he was literally a child. As I write this Warren Buffett’s net worth is $84.5 billion. Of that, $84.2 billion was accumulated after his 50th birthday. $81.5 billion came after he qualified for Social Security, in his mid-60s. Warren Buffett is a phenomenal investor. But you miss a key point if you attach all of his success to investing acumen. The real key to his success is that he’s been a phenomenal investor for three quarters of a century. Had he started investing in his 30s and retired in his 60s, few people would have ever heard of him. Consider a little thought experiment. Buffett began serious investing when he was 10 years old. By the time he was 30 he had a net worth of $1 million, or $9.3 million adjusted for inflation.16 What if he was a more normal person, spending his teens and 20s exploring the world and finding his passion, and by age 30 his net worth was, say, $25,000? And let’s say he still went on to earn the extraordinary annual investment returns he’s been able to generate (22% annually), but quit investing and retired at age 60 to play golf and spend time with his grandkids. What would a rough estimate of his net worth be today? Not $84.5 billion. $11.9 million. 99.9% less than his actual net worth. Effectively all of Warren Buffett’s financial success can be tied to the financial base he built in his pubescent years and the longevity he maintained in his geriatric years. His skill is investing, but his secret is time. That’s how compounding works. Think of this another way. Buffett is the richest investor of all time. But he’s not actually the greatest—at least not when measured by average annual returns.
Morgan Housel (The Psychology of Money: Timeless lessons on wealth, greed, and happiness)
Guides
Larry E. Swedroe (Think, Act, and Invest Like Warren Buffett - Canadian Edition)
Wise Investing series is a collection of stories and analogies designed to demonstrate that the winning investment strategy is a simple, elegant,
Larry E. Swedroe (Think, Act, and Invest Like Warren Buffett - Canadian Edition)
Wise Investing series is a collection of stories and analogies designed to demonstrate that the winning
Larry E. Swedroe (Think, Act, and Invest Like Warren Buffett - Canadian Edition)
investors and increase the chances of achieving your financial and life goals. Over the years, I have talked
Larry E. Swedroe (Think, Act, and Invest Like Warren Buffett - Canadian Edition)
financial and life goals. Over the years, I have talked to thousands of people about investing. I have
Larry E. Swedroe (Think, Act, and Invest Like Warren Buffett - Canadian Edition)
Buffett knows that a down market is when investors should be buying, not selling.
Larry E. Swedroe (Think, Act, and Invest Like Warren Buffett: The Winning Strategy to Help You Achieve Your Financial and Life Goals)
Your goal as an investor should simply be to purchase, at a rational price, a part interest in an easily-understandable business whose earnings are virtually certain to be materially higher five, ten and twenty years from now. Over time, you will find only a few companies that meet these standards—so when you see one that qualifies, you should buy a meaningful amount of stock.
Jeff Matthews (Secrets in Plain Sight: Business & Investing Secrets of Warren Buffett, 2011 Edition)
I insist on a lot of time being spent, almost every day, to just sit and think. That is very uncommon in American business. I read and think. So I do more reading and thinking, and make less impulse decisions than most people in business. I do it because I like this kind of life.
Kathryn Sandberg (WARREN BUFFETT Ultimate Principles Of Success And Wealth, Best Teachings On Investment, Wealth & Wisdom. (Warren Buffett Kindle Books, Financial Education,Business Investing))
Materialism in Moderation: The Minimalist Lifestyle of Warren Buffett     This is the home in Omaha that Warren Buffett purchased for $31,500 back in 1957 before he earned his status as a millionaire. This is also the home that Warren Buffett still lives in today, despite his additional wealth.
Tatyana Williams (WARREN BUFFETT Top Life Lessons: Warren Buffett Lessons for Unlimited Success in Business, Investing and Life! Warren Buffett (Warren Buffett, Warren Buffett ... Warren Buffett Investing, Warren Buffett))
Berkshire has long been invested in branded food companies and recently took a more than 8% stake in Kraft Foods. Buffett observed that big food companies are good businesses. They earn good returns on tangible assets. Good brands like See’s, Coke, Mars, Wrigley’s are tough to compete with. Coke now provides 1.5 billion servings a day worldwide. Since 1886, Coke has been delivering “happiness” and “refreshing” associations. These associations get implanted in people’s minds. Good branded products are often a good investment.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
he argued with Susie that she had been conned into spending too much money on Howard's coffin.
Alice Schroeder (The Snowball: Warren Buffett and the Business of Life)
I could improve your ultimate financial welfare by giving you a ticket with only 20 slots in it so that you had 20 punches—representing all the investments that you got to make in a lifetime. And once you’d punched through the card, you couldn’t make any more investments at all. Under those rules, you’d really think carefully about what you did and you’d be forced to load up on what you’d really thought about. So you’d do so much better.
Warren Buffett
Personally, I would not pay more than a P/E of 20 (earnings yield of 5%) for a company like Coke.
Matthew R. Kratter (Invest Like Warren Buffett: Powerful Strategies for Building Wealth)
This is often referred to as the “earnings yield” of a stock. You can calculate it in one of 2 ways: 1. Earnings per share divided by the stock’s price per share 2. Net profit divided by the market cap
Matthew R. Kratter (Invest Like Warren Buffett: Powerful Strategies for Building Wealth)
Now don’t forget, this company’s book value is growing because of one figure – the earnings. As you look back to the beginning of this section, remember the diagram that shows the two options a company has to distribute or invest its earnings.
Preston Pysh (Warren Buffett's Three Favorite Books)
Operating Activities: This is all the activity that involves earning money. Investing Activities: This is all the activity that involves buying or selling assets. Financing Activities: This is all the activity that involves acquiring debt or paying it off.
Preston Pysh (Warren Buffett's Three Favorite Books)
Furthermore, we do not think so-called EBITDA (earnings before interest, taxes, depreciation and amortization) is a meaningful measure of performance. Managements that dismiss the importance of depreciation - and emphasize "cash flow" or EBITDA - are apt to make faulty decisions, and you should keep that in mind as you make your own investment decisions,
Warren Buffett (The Essays of Warren Buffett: Lessons for Corporate America)
The idea is to find investments that give you money, not take it.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
You can live a full and rewarding life without ever thinking about Goodwill and its amortization. But students of investment and management should understand the nuances of the subject.” -1983 letter
Mark Gavagan (Gems from Warren Buffett - Wit and Wisdom from 34 Years of Letters to Shareholders)
O ponto de partida está em observar a relação entre Preço e Lucro da Ação, o famoso P/L. Quando esta relação está abaixo de 20, podemos começar a prestar atenção na empresa. Abaixo de 15: “Opa! Está ficando interessante!”. Abaixo de 10 pode ser uma oportunidade clara, mas abaixo de 5, preste atenção, pode ser um negócio arriscado. Obviamente, este fator não pode ser observado isoladamente. O P/L deve estar conciliado com uma boa Rentabilidade sobre o Patrimônio Líquido (RPL) ou Return On Equity (ROE). Acima de 10% seria ideal, mas para começar, 8% já seria um bom indicativo. De pouco adianta a empresa ter boa rentabilidade se ela não reparte parte dos lucros com seus acionistas, então o Dividend Yield também deve ser considerado na análise. Para Décio Bazin, autor do livro “Faça Fortuna com Ações”, um DY mínimo de 6% é o recomendável. Vale lembrar que estamos traduzindo Buffett e Munger para a realidade brasileira. Um quarto aspecto fundamental para iniciar uma análise de investimento é observar o grau de endividamento da companhia. Uma empresa que deve mais do que o valor do próprio patrimônio líquido, deve ser evitada. Neste
Tiago Reis (Lições de Valor com Warren Buffett & Charlie Munger: Ensinamentos para quem investe em Bolsa com foco no longo prazo (Suno Call Livro 1))
Naval’s Laws The below is Naval’s response to the question “Are there any quotes you live by or think of often?” These are gold. Take the time necessary to digest them. “These aren’t all quotes from others. Many are maxims that I’ve carved for myself.” Be present above all else. Desire is suffering (Buddha). Anger is a hot coal that you hold in your hand while waiting to throw it at someone else (Buddhist saying). If you can’t see yourself working with someone for life, don’t work with them for a day. Reading (learning) is the ultimate meta-skill and can be traded for anything else. All the real benefits in life come from compound interest. Earn with your mind, not your time. 99% of all effort is wasted. Total honesty at all times. It’s almost always possible to be honest and positive. Praise specifically, criticize generally (Warren Buffett). Truth is that which has predictive power. Watch every thought. (Always ask, “Why am I having this thought?”) All greatness comes from suffering. Love is given, not received. Enlightenment is the space between your thoughts (Eckhart Tolle). Mathematics is the language of nature. Every moment has to be complete in and of itself. A Few of Naval’s Tweets that are Too Good to Leave Out “What you choose to work on, and who you choose to work with, are far more important than how hard you work.” “Free education is abundant, all over the Internet. It’s the desire to learn that’s scarce.” “If you eat, invest, and think according to what the ‘news’ advocates, you’ll end up nutritionally, financially, and morally bankrupt.” “We waste our time with short-term thinking and busywork. Warren Buffett spends a year deciding and a day acting. That act lasts decades.” “The guns aren’t new. The violence isn’t new. The connected cameras are new, and that changes everything.” “You get paid for being right first, and to be first, you can’t wait for consensus.” “My one repeated learning in life: ‘There are no adults.’ Everyone’s making it up as they go along. Figure it out yourself, and do it.” “A busy mind accelerates the passage of subjective time.
Timothy Ferriss (Tools of Titans: The Tactics, Routines, and Habits of Billionaires, Icons, and World-Class Performers)
Research and development conducted by private companies in the United States has grown enormously over the past four decades. We have substantially replaced the publicly funded science that drove our growth after World War II with private research efforts. Such private R&D has shown some impressive results, including high average returns for the corporate sector. However, despite their enormous impact, these private R&D investments are much too small from a broader perspective. This is not a criticism of any individuals; rather, it is simply a feature of the system. Private companies do not capture the spillovers that their R&D efforts create for other corporations, so private sector executives in established firms underinvest in invention. The venture capital industry, which provides admirable support to some start-ups, is focused on fast-impact industries, such as information technology, and not generally on longer-run and capital-intensive investments like clean energy or new cell and gene therapies. Leading entrepreneur-philanthropists get this. In recent years, there have been impressive investments in science funded by publicly minded individuals, including Eric Schmidt, Elon Musk, Paul Allen, Bill and Melinda Gates, Mark Zuckerberg, Michael Bloomberg, Jon Meade Huntsman Sr., Eli and Edythe Broad, David H. Koch, Laurene Powell Jobs, and others (including numerous private foundations). The good news is that these people, with a wide variety of political views on other matters, share the assessment that science—including basic research—is of fundamental importance for the future of the United States. The less good news is that even the wealthiest people on the planet can barely move the needle relative to what the United States previously invested in science. America is, roughly speaking, a $20 trillion economy; 2 percent of our GDP is nearly $400 billion per year. Even the richest person in the world has a total stock of wealth of only around $100 billion—a mark broken in early 2018 by Jeff Bezos of Amazon, with Bill Gates and Warren Buffett in close pursuit. If the richest Americans put much of their wealth immediately into science, it would have some impact for a few years, but over the longer run, this would hardly move the needle. Publicly funded investment in research and development is the only “approach that could potentially return us to the days when technology-led growth lifted all boats. However, we should be careful. Private failure is not enough to justify government intervention. Just because the private sector is underinvesting does not necessarily imply that the government will make the right investments.
Jonathan Gruber (Jump-Starting America Jump-Starting America: How Breakthrough Science Can Revive Economic Growth and the How Breakthrough Science Can Revive Economic Growth and the American Dream American Dream)
Nancy Peretsman of Allen & Co., a top Wall Street banker and a specialist in internet and media deals. Buffett was high on Peretsman, who had been a budding star at Salomon Brothers, the investment bank in which he was a large investor, before she joined forces with Herbert Allen. It was Peretsman who placed the first call to Amazon CEO Jeff Bezos, a casual friend of Graham’s for 15 years, to tell him the Post was for sale.
Jill Abramson (Merchants of Truth: The Business of Facts and The Future of News)
Bill and Melinda Gates have said they will give away all the money in their foundation within twenty years of when the last one dies, at which point the foundation will close its doors. Right now, that sum—along with their private investments—amounts to around $120 billion. But if you add in the money Buffett has pledged to the Gates Foundation, we’re talking about an even higher figure—over $150 billion. At some point, moving money at this scale will likely require the world’s biggest foundation to get even larger, increasing an annual grantmaking level that already far exceeds that of any other funder by a large margin.
David Callahan (The Givers: Wealth, Power, and Philanthropy in a New Gilded Age)
The Buffett Foundation remains a top supporter of Planned Parenthood and other groups that back abortion access, as it was when the senior Susie ran it. Yet now it’s writing even bigger checks. One of its largest impacts has been around contraception, where the foundation has played a key role in battling unwanted pregnancies by helping bankroll new birth control options. Its grants have helped revolutionize the use of IUDs, a long-acting form of contraception. A reason that IUDs are so effective is because, once these tiny T-shaped devices are inserted into the uterus, there’s no room for user error. The Buffett Foundation invested heavily both in research to improve IUDs and programs to spread their use. “Quietly, steadily, the Buffett family is funding the biggest shift in birth control in a generation,” according to one media account.
David Callahan (The Givers: Wealth, Power, and Philanthropy in a New Gilded Age)
The role of scarcity is particularly easy to overlook in a strategy. But without it a firm may have an internally consistent system built around an interesting innovative idea, only to see it quickly imitated at the first signs of success. Warren Buffett refers to this kind of scarcity as an “economic moat,” a barrier that keeps other competition away. The bigger and deeper the moat, the more attractive he finds the company as an investment.
Cynthia Montgomery (The Strategist: Be the Leader Your Business Needs)
Habit 1: Reading + Numbers Habit 2: The Principal of Compounding in Finance and Life Habit 3: The circle of competence Habit 4: Power of isolation, thinking and No Internet! Habit 5: Inner scorecard or outer scorecard? Habit 6: Do what you love – The Science of not getting bored and eventually succeed! Habit 7: Cash is King – Really? Habit 8: Invest in yourself - Pay yourself first! Habit 9: Time management: - 24 hours/1440 minutes a day
Isaac Fox (Warren Buffett: 9 Daily Habits of Warren Buffett [Entrepreneur, Highly Effective, Motivation, Rich, Success])
In The Tao of Warren Buffett, Mary Buffett and David Clark explain: “Warren decided early in his career it would be impossible for him to make hundreds of right investment decisions, so he decided that he would invest only in the businesses that he was absolutely sure of, and then bet heavily on them. He owes 90% of his wealth to just ten investments. Sometimes what you don’t do is just as important as what you do.
Greg McKeown (Essentialism: The Disciplined Pursuit of Less)
Loss of focus is what most worries Charlie and me when we contemplate investing in businesses that in general look outstanding. All too often, we’ve seen value stagnate in the presence of hubris or of boredom that caused the attention of managers to wander.
Warren Buffett (The Essays of Warren Buffett: Lessons for Corporate America)
Warren Buffett wird nicht müde zu betonen, dass es an ihm ist, sich selbst die Verwaltung des kleinsten Geldbetrages sehr angelegen sein zu lassen. Und eben darin bekundet sich jenes Verantwortungsbewusstsein, mit dem Staat zu machen ist.
Collin Coel (Vertrauen im Investmentgeschäft)
Of all the professional money managers, Warren Buffett’s record stands out as the most extraordinary. For over 40 years, Buffett’s company, Berkshire Hathaway, has earned a rate of return for his stockholders twice as large as the stock market as a whole. But that record was not achieved only by his ability to purchase “undervalued” stocks, as it is often portrayed in the press. Buffett buys companies and holds them. (He has suggested that the correct holding period for a stock is forever.)
Burton G. Malkiel (The Elements of Investing: Easy Lessons for Every Investor)
Jason Zweig, senior writer and columnist at Money magazine and coauthor of the revised edition of Benjamin Graham's classic, The Intelligent Investor: "If you buy-and then hold-a total stock market index fund, it is mathematically certain that you will outperform the vast majority of all other investors in the long run. Graham praised index funds as the best choice for individual investors, as does Warren Buffett.
Taylor Larimore (The Bogleheads' Guide to Investing)
Buffett noted that investing is really all about laying out cash now to get more back later. Buffett
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
Ben Graham taught me 45 years ago that in investing it is not necessary to do extraordinary things to get extraordinary results. In later life, I have been surprised to find that this statement holds true in business management as well. What a manager must do is handle the basics well and not get diverted.
Mark Gavagan (Gems from Warren Buffett - Wit and Wisdom from 34 Years of Letters to Shareholders)
A great business will have earnings that show a smooth upward trend.
Matthew R. Kratter (Invest Like Warren Buffett: Powerful Strategies for Building Wealth)
A great business will show a consistent return on equity (ROE) above 20%.
Matthew R. Kratter (Invest Like Warren Buffett: Powerful Strategies for Building Wealth)
Warren Buffett invests according to four simple principles. Vigilant leadership Long-term prospects Stock stability Buy at attractive prices. One of the greatest strengths of Warren Buffett is his ability to make things simple. As you can see above, his principles are straightforward and easy to remember. As you navigate your way through this book, always keep these four principles at the forefront of your mind. Ensuring that all four are met at all times is paramount to anything else.
Stig Brodersen (Warren Buffett Accounting Book: Reading Financial Statements for Value Investing (Warren Buffett's 3 Favorite Books))
We base decisions on information that’s easily recalled. Airplane crashes make the news, so we are more fearful of flying than driving, even though car accidents cause many more deaths. Similarly, we hear a lot about investment legend Warren Buffett and a lot about lottery ticket winners, which makes beating the market and winning the lottery seem far more likely than they really are.
Jonathan Clements (How to Think About Money)
sustainable,
Bruce C.N. Greenwald (Value Investing: From Graham to Buffett and Beyond (Wiley Finance))
If you are going to be a lifelong buyer of food, you welcome falling prices and deplore price increases. So should it be with investments.
Daniel Pecaut (University of Berkshire Hathaway: 30 Years of Lessons Learned from Warren Buffett & Charlie Munger at the Annual Shareholders Meeting)
Just because something is conventional doesn't mean it's conservative or correct
Jeremy C. Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
From peak to trough (June 1998 through March 2000), Warren Buffett's Berkshire Hathaway fell 51% in value! During this time, I estimated that Buffett's net worth fell by more than $10 billion. How much Berkshire did Buffett sell? How much Cisco did he buy? Zero point zero. Not tempted by tech stocks, Buffett remained committed to value investing, and it paid off.1 One of the keys to successfully managing your money is to accept, like Buffett did, that there will be times when your style is out of favor or when your portfolio hits a rough patch. It's when you start to reach for opportunities that you can do serious damage to your financial well‐being.
Michael Batnick (Big Mistakes: The Best Investors and Their Worst Investments (Bloomberg))
Buffett told him, “Investing in yourself is the most important investment you’ll ever make in your life. . . . There’s no financial investment that’ll ever match it, because if you develop more skill, more ability, more insight, more capacity, that’s what’s going to really provide economic freedom. . . . It’s those skill sets that really make that happen.
Timothy Ferriss (Tools of Titans: The Tactics, Routines, and Habits of Billionaires, Icons, and World-Class Performers)
Warren Buffett once said, “You can determine the strength of a business over time by the amount of agony they go through in raising prices.”4 Buffett and his partner, Charlie Munger, realized that as customers form routines around a product, they come to depend upon it and become less sensitive to price. The duo have pointed to consumer psychology as the rationale behind their famed investments in companies like See’s Candies and Coca-Cola.5 Buffett and Munger understand that habits give companies greater flexibility to increase prices.
Nir Eyal (Hooked: How to Build Habit-Forming Products)
Loss of focus is what most worries Charlie and me when we contemplate investing in businesses that in general look outstanding.
Warren Buffett (The Essays of Warren Buffett: Lessons for Corporate America)
Leaving the question of price aside, the best business to own is one that over an extended period can employ large amounts of incremental capital at very high rates of return.
Warren Buffett (The Essays of Warren Buffett: Lessons for Corporate America)
not to let the perfect be the enemy of the good.
Danielle Town (Invested: How Warren Buffett and Charlie Munger Taught Me to Master My Mind, My Emotions, and My Money (with a Little Help from My Dad))
I am confident it will not only help you become more disciplined but also a more RATIONAL, OPTIMISTIC, and LONG-TERM investor. The ultimate act of generosity is Warren Buffett sharing his genius with the individual investor!
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
I read annual reports of the company I’m looking at, and I read the annual reports of the competitors—that is the main source of material.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
I like a business that, when it’s not managed at all, still makes lots of money. That’s my kind of business.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
If you like spending 6–8 hours per week on investments, do it. If you don’t, then dollar-cost average into index funds. This accomplishes diversification across assets and time, two very important things.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
The single most important decision in evaluating a business is pricing power. If you have the power to raise prices without losing business to a competitor, you’ve got a very good business.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
The key to investing is not assessing how much an industry is going to affect society, or how much it will grow, but rather determining the competitive advantage of any given company and, above all, the durability of that advantage.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
A great investment opportunity occurs when a marvelous business encounters a one-time huge, but solvable problem.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
The asset I most value, aside from health, is interesting, diverse, and long-standing friends.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Buy shares in a few high-quality, well-run businesses at a fair price, and then hold them forever.
Matthew R. Kratter (Invest Like Warren Buffett: Powerful Strategies for Building Wealth)
I insist on a lot of time being spent, almost every day, to just sit and think. That is very uncommon in American business. I read and think. So I do more reading and thinking, and make less impulse decisions than most people in business. I do it because I like this kind of life.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
The difference between successful people and very successful people is that very successful people say “no” to almost everything.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Buy into a company because you want to own it, not because you want the stock to go up.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Your goal as an investor should simply be to purchase, at a rational price, a part interest in an easily-understandable business whose earnings are virtually certain to be materially higher five, ten and twenty years from now. Over time, you will find only a few companies that meet these standards
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Much success can be attributed to inactivity. Most investors cannot resist the temptation to constantly buy and sell.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Market forecasters will fill your ear but never fill your wallet.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Rationality is essential.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
We have to decide whether we can sensibly estimate an earnings range for five years out, or more. If the answer is yes, we will buy the stock (or business) if it sells at a reasonable price in relation to the bottom boundary of our estimate.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Don’t pass up something that’s attractive today because you think you will find something more attractive tomorrow.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
You are neither right nor wrong because the crowd disagrees with you. You are right because your data and reasoning are right.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
To invest successfully, you need not understand beta, efficient markets, modern portfolio theory, option pricing, or emerging markets. You may, in fact, be better off knowing nothing of these. That, of course, is not prevailing view at most business schools, whose finance curriculum tends to be dominated by such subjects. In our view, though, investment students need only two well-taught courses—How to Value a Business, and How to Think About Market Prices.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
were predominately limited to a gas station and unfruitful real estate investments. Unfortunately none of his personal financial ventures during this early period of his marriage were successful. However, It was during this time that Buffet began teaching night courses at the University of Omaha, a feat that would not have been possible for the naturally shy and humble Buffett if it were not for a public speaking course he took at Dale Carnegie University, a degree that Buffett still credits as being the most beneficial to his professional life. “Wall Street is the only place that people ride to in a Rolls-Royce to get advice from those who take the subway.
George Ilian (Warren Buffett: The Life and Business Lessons of Warren Buffett)
One investor's two rules of investing: Never lose money. Never forget rule #1. (Warren Buffett)
Jim Paul (What I Learned Losing a Million Dollars)
Twenty-six percent happens to be the exact compounded annual rate of return if you double your money in three years. That’s the goal—double your money every three years.
Danielle Town (Invested: How Warren Buffett and Charlie Munger Taught Me to Master My Mind, My Emotions, and My Money (with a Little Help from My Dad))
Try to focus on customers flow and business potential the business you are investing in might or might not have, because that is basically the only way you will be certain that you have made a smart decision.
Mike Jellick (Warren Buffett: Life Changing Lessons of Warren Buffet for Unlimited Success in Investing, Business and Life (Warren Buffett, warren buffett's 3 favorite books, warren buffett biography))
We select such investments on a long-term basis, weighing the same factors as would be involved in the purchase of 100% of an operating business: (1) favorable long-term economic characteristics; (2) competent and honest management; (3) purchase price attractive when measured against the yardstick of value to a private owner; and (4) an industry with which we are familiar and whose long-term business characteristics we feel competent to judge.
Warren Buffett (Berkshire Hathaway Letters to Shareholders)
The line separating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money. After a heady experience of that kind, normally sensible people drift into behavior akin to that of Cinderella at the ball. They know that overstaying the festivities — that is, continuing to speculate in companies that have gigantic valuations relative to the cash they are likely to generate in the future — will eventually bring on pumpkins and mice. But they nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There’s a problem, though: They are dancing in a room in which the clocks have no hands.
Warren Buffett (Berkshire Hathaway Letters to Shareholders)
Warren Buffett’s top two rules of investing? Rule 1: don’t lose money! Rule 2: see rule 1.
Anthony Robbins (MONEY Master the Game: 7 Simple Steps to Financial Freedom)
Be accurate, be balanced, and be careful (the ABCs) when selecting a future growth rate.
Stig Brodersen (Warren Buffett Accounting Book: Reading Financial Statements for Value Investing (Warren Buffett's 3 Favorite Books))
Management and chairman of the Santa Fe Institute: “Buffett’s advice is so good but so hard. The point when there’s a valuation extreme is precisely the point when the emotional pull—in the wrong direction—is strongest.”11 Adds James Montier, portfolio manager at GMO: “People love extrapolation and forget that cycles exist. The good news is that you get paid for doing uncomfortable things, when stocks are at trough earnings and low multiples their implied return is high, in contrast you don’t get paid for
John Mihaljevic (The Manual of Ideas: The Proven Framework for Finding the Best Value Investments)
Your best investment is yourself. There is nothing that compares to it.
David Andrews (The Oracle Speaks: Warren Buffett In His Own Words (In Their Own Words))
Bundy sternly tool his fellow endowment fund managers to task - not for being too bold, but for being insufficiently so: We have the preliminary impression that over the long run caution has cost our colleges and universities much more than imprudence or excessive risk-taking.
Roger Lowenstein (Buffett: The Making of an American Capitalist)
The Economics of Property-Casualty Insurance With the acquisition of General Re — and with GEICO’s business mushrooming — it becomes more important than ever that you understand how to evaluate an insurance company. The key determinants are: (1) the amount of float that the business generates; (2) its cost; and (3) most important of all, the long-term outlook for both of these factors. To begin with, float is money we hold but don't own. In an insurance operation, float arises because premiums are received before losses are paid, an interval that sometimes extends over many years. During that time, the insurer invests the money. Typically, this pleasant activity carries with it a downside: The premiums that an insurer takes in usually do not cover the losses and expenses it eventually must pay. That leaves it running an "underwriting loss," which is the cost of float. An insurance business has value if its cost of float over time is less than the cost the company would otherwise incur to obtain funds. But the business is a lemon if its cost of float is higher than market rates for money. A caution is appropriate here: Because loss costs must be estimated, insurers have enormous latitude in figuring their underwriting results, and that makes it very difficult for investors to calculate a company's true cost of float. Errors of estimation, usually innocent but sometimes not, can be huge. The consequences of these miscalculations flow directly into earnings. An experienced observer can usually detect large-scale errors in reserving, but the general public can typically do no more than accept what's presented, and at times I have been amazed by the numbers that big-name auditors have implicitly blessed. As for Berkshire, Charlie and I attempt to be conservative in presenting its underwriting results to you, because we have found that virtually all surprises in insurance are unpleasant ones. The table that follows shows the float generated by Berkshire’s insurance operations since we entered the business 32 years ago. The data are for every fifth year and also the last, which includes General Re’s huge float. For the table we have calculated our float — which we generate in large amounts relative to our premium volume — by adding net loss reserves, loss adjustment reserves, funds held under reinsurance assumed and unearned premium reserves, and then subtracting agents balances, prepaid acquisition costs, prepaid taxes and deferred charges applicable to assumed reinsurance. (Got that?)
Warren Buffett (Berkshire Hathaway Letters to Shareholders)
Passion leads to commitment, which breeds discipline and study, which ultimately leads to success.
Anthony Clark (Warren Buffett: 48 Empowering Lessons from Warren Buffet for Life Changing Success in Investing, Business and Life (Warren Buffett book, warren buffett way, warren buffett biography))
Like Wayne Gretzky says, go where the puck is going, not where it is.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
The happiest people do not necessarily have the best things. They simply appreciate the things they have.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
The modern Berkshire Hathaway that he had created churned out new beads for the rosary almost like a clockwork. Buffett’s hunt for things to buy had become more ambitious, free of the cigar butts and lawsuits of the decades before. The great engine of compounding worked as a servant on his behalf, at exponential speed and under the gathering approval of a public gaze. The method was the same: estimate an investment’s intrinsic value, handicap its risk, buy using margin of safety, concentrate, stay in the circle of competence, let it roll as compounding did the work. Anyone could understand these simple ideas, but few could execute them. Even though Buffett made the process look effortless, the technique and discipline underlying it actually did involve an enormous amount of work for him and his employees. As
Alice Schroeder (The Snowball: Warren Buffett and the Business of Life)
Many security analysts still believe that agencies are a poor investment. Not so Warren Buffett, one of the most successful investors in the world. He has taken substantial positions in three publicly held agencies, and is quoted as saying, ‘The best business is a royalty on the growth of others, requiring very little capital itself … such as the top international advertising agencies.’ If
David Ogilvy (Ogilvy on Advertising)
As the “Oracle of Omaha” said, “It’s better to hang out with people better than you. Pick out associates whose behavior is better than yours and you’ll drift in that direction.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
1. Investors give fund managers money at the wrong time. Now that you’ve had some time to read this book and understand the importance of buying stocks during fear cycles and holding during greed cycles, this first indicator should make sense. To understand this principle, imagine that you’re the fund manager of a $100 billion investment fund. When the stock market crashes and you’re able to purchase severely undervalued businesses with minimal debt, not only do you lack funds to invest, but all your resources are being depleted by scared investors. Instead of receiving money to buy the great deals, your investors are selling their shares in the fund and you don’t have the capacity to take advantage of the market behavior. This reason alone severely handicaps fund managers as they attempt to beat the market.
Preston Pysh (Warren Buffett's Three Favorite Books)
The Four Golden Rules   An investment must be managed by vigilant leaders. An investment must have long-term prospects. An investment must be stable and understandable. An investment must be undervalued.  
Preston Pysh (Warren Buffett's Three Favorite Books)
I still sometimes get comments from partners like: “Say, Berkshire is up four points—that’s great!” or “What’s happening to us, Berkshire was down three last week?” Market price is irrelevant to us in the valuation of our controlling interests. We valued B-H at 25 at yearend 1967 when the market was about 20 and 31 at yearend 1968 when the market was about 37. We would have done the same thing if the markets had been 15 and 50 respectively. (“Price is what you pay. Value is what you get).” We will prosper or suffer in controlled investments in relation to the operating performances of our businesses—we will not attempt to profit by playing various games in the securities markets. Whether
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
We live in an investment world, populated not by those who must be logically persuaded to believe, but by the hopeful, credulous and greedy, grasping for an excuse to believe.9
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
When it comes to investing, it’s critical not to “force it.” Markets will cycle. There will be times when you too feel “out of step” with the market, just as Buffett did in the late 1960s. You’ll find that during the late bull market mania of the Go-Go years, his standards remained firmly set, while the pressure to perform caused the standards of many of even the best around him to crumble. It’s hard not to cave your principles in at the top of the cycle when your value approach has apparently stopped working and everyone around you seems to be making money easily (that’s why so many people do it). However, it’s more often than not a “buy high, sell low” strategy. Buffett set his plan, established his standards, and then entered the fray, maintaining the courage of his convictions, come what may.
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
Rather than attempt to time the market or pick individual stocks, it is more productive to invest and stay invested. As Warren Buffett said: “We continue to make more money when snoring than when active.” Mr. Buffett also said: “Most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that charges minimal fees. Those following this path are sure to beat the net results (after expenses and fees) delivered by the great majority of investment professionals.
Larry E. Swedroe (The Only Guide to a Winning Investment Strategy You'll Ever Need: The Way Smart Money Preserves Wealth Today)
The key parts you’ve hopefully learned are the following: 1. There are four rules to investing. All four must be met in order to purchase an asset. 2. Financial markets move on emotion in the short term but follow value in the long term. As a result, always possess patience, knowledge, and think for yourself. 3. Every month you need to purchase assets in order to increase cash flow. Use that compounding cash flow to always reinvest in the most undervalued assets. In the end, it’s all about share accumulation. 4. When you don’t understand terms or concepts, do the research. That’s the only way you’ll ever know.
Preston Pysh (Warren Buffett's Three Favorite Books)
Most institutional and individual investors will find the best way to own common stock is through an index fund that charges minimal fees. Those following this path are sure to beat the net results [after fees and expenses] delivered by the great majority of investment professionals.”1 —Warren Buffett, chairman of Berkshire Hathaway
Charles D. Ellis (The Index Revolution: Why Investors Should Join It Now)
Study the Opposites In addition to studying his competition in tech and early-stage investing, Marc studies value investors on the completely opposite side of the spectrum, such as Warren Buffett and Seth Klarman. This doesn’t mean they invest in the same types of companies; rather, the synergy is related to first principles.
Timothy Ferriss (Tools of Titans: The Tactics, Routines, and Habits of Billionaires, Icons, and World-Class Performers)
A few major opportunities, clearly recognizable as such, will usually come to one who continuously searches and waits, with a curious mind loving diagnosis involving multiple variables. And then all that is required is a willingness to bet heavily when the odds are extremely favorable, using resources available as a result of prudence and patience in the past.” Charles T. Munger Frequently overshadowed by Warren Buffett, his partner in the $300 billion Berkshire Hathaway holding company, Charlie Munger is a quiet, reclusive figure. Rarely making public appearances, the unostentatious billionaire spends most of his time as Buffett does: reading, thinking, and managing Berkshire Hathaway from his home in Southern California. Buffett and Munger have, over the course of their careers, amassed a multi-billion dollar empire with a brilliant-in-its-simplicity investment strategy: value investing.
Taylor Pearson (The End of Jobs: Money, Meaning and Freedom Without the 9-to-5)
The public shareholders who invested with Buffett also got rich, and in exactly the same proportion to their capital that Buffett did. The numbers themselves are almost inconceivable. If one had invested $10,000 when Buffett began his career, working out of his study in Omaha in 1956, and had stuck with him throughout, one would have had an investment at the end of 1995 worth $125 million.2
Roger Lowenstein (Buffett: The Making of an American Capitalist)
Warren Buffett complains about it every year; it is a lot harder to manage billions than millions. The investable market is much smaller.
Jonathan Stanford Yu (From Zero to Sixty on Hedge Funds and Private Equity 2.0: What They Do, How They Do It, and Why They Do The Mysterious Things They Do)
the smaller hedge funds tend to do better performance-wise than the large funds. Their management fees are not enough to keep the doors open so they have to make good returns and take those incentive fees, creating a sort of Darwinian eat-what-they-cook situation. And it is just easier to invest a tiny fund (again, just ask Warren Buffett).
Jonathan Stanford Yu (From Zero to Sixty on Hedge Funds and Private Equity 2.0: What They Do, How They Do It, and Why They Do The Mysterious Things They Do)
Skilled investors can maximize their long-term performance by maximizing the margin of safety of each stock held in the portfolio, which is to say, by concentrating on the best ideas. To be “skilled,” an investor must be able to identify which stocks are more undervalued than others, and then construct a portfolio containing only the most undervalued stocks. In doing so, investors take on the risk that an unforeseeable event leads to an unrecoverable loss in the intrinsic value of any single holding, perhaps through financial distress or fraud. This unrecoverable diminution in intrinsic value is referred to in the value investing literature as a permanent impairment of capital, and it is the most important consideration for value investors. Value investors distinguish the partial or total diminution in the firm’s underlying value, which is a risk to be considered, from a mere drop in the share price, no matter how significant the drop may be, which is an event to be ignored or exploited. The extent to which the portfolio value is impacted by a portfolio holding suffering a permanent impairment of capital will depend on the size of the holding relative to the portfolio value—the bigger the holding, the greater the impact on the portfolio. Thus the more concentrated an investor becomes, the greater the need to understand individual holdings. Says Buffett of the “know-something” investor:28 [If] you are a know-something investor, able to understand business economics and to find five to 10 sensibly priced companies that possess important
Allen C. Benello (Concentrated Investing: Strategies of the World's Greatest Concentrated Value Investors)
When Buffett was asked by business students in 2008 about his views on portfolio diversification and position sizing, he responded that he had “two views on diversification:”13 If you are a professional and have confidence, then I would advocate lots of concentration. For everyone else, if it’s not your game, participate in total diversification. If it’s your game, diversification doesn’t make sense. It’s crazy to put money in your twentieth choice rather than your first choice. . . . [Berkshire vice-chairman] Charlie [Munger] and I operated mostly with five positions. If I were running $50, $100, $200 million, I would have 80 percent in five positions, with 25 percent for the largest. In 1964 I found a position I was willing to go heavier into, up to 40 percent. I told investors they could pull their money out. None did. The position was American Express after the Salad Oil Scandal.
Allen C. Benello (Concentrated Investing: Strategies of the World's Greatest Concentrated Value Investors)
In his investing, he has said he is governed by three easy rules: One, never lose money; two, never forget rule number one; and three, never go into debt.
Will Peters (Leadership Lessons: Warren Buffett, Walt Disney, Thomas Edison, Katharine Graham, Steve Jobs, and Ray Kroc)
When dealing only with his own money, investment losses never bothered Munger much. To him it was like a losing night in a regular poker game where you knew you were one of the best players—you'd make up the difference later. But he now found that reported, temporary quotational losses in the Wheeler, Munger limited partnership accounts gave him tremendous pain. And so, by the end of 1974, he had resolved, like Buffett, to stop managing money for others in a limited partnership format. He would liquidate Wheeler, Munger after its asset value made a substantial recovery. And he would liquidate soon enough so that he would not take any general partner's override when the main investment positions were distributed. In 1975, Wheeler, Munger did make an impressive recovery with a gain of 73.2 percent, and Munger and Marshall liquidated the partnership early in 1976.
Janet Lowe (Damn Right!: Behind the Scenes with Berkshire Hathaway Billionaire Charlie Munger)
Bad terminology is the enemy of good thinking. When companies or investment professionals use terms such as "EBITDA" and "pro forma," they want you to unthinkingly accept concepts that are dangerously flawed.
Mark Gavagan (Gems from Warren Buffett - Wit and Wisdom from 34 Years of Letters to Shareholders)
Occasional outbreaks of those two super-contagious diseases, fear and greed, will forever occur in the investment community. The timing of these epidemics will be unpredictable. And the market aberrations produced by them will be equally unpredictable, both as to duration and degree. Therefore, we never try to anticipate the arrival or departure of either disease. Our goal is more modest: we simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.
Mark Gavagan (Gems from Warren Buffett - Wit and Wisdom from 34 Years of Letters to Shareholders)
long periods of substantial undervaluation and/or overvaluation will cause the gains of the business to be inequitably distributed among various owners, with the investment result of any given owner largely depending upon how lucky, shrewd, or foolish he happens to be.
Mark Gavagan (Gems from Warren Buffett - Wit and Wisdom from 34 Years of Letters to Shareholders)
Ben Graham taught me 45 years ago that in investing it is not necessary to do extraordinary things to get extraordinary results. In later life, I have been surprised to find that this statement holds true in business management as well. What a manager must do is handle the basics well and not get diverted.
Mark Gavagan (Gems from Warren Buffett - Wit and Wisdom from 34 Years of Letters to Shareholders)
And the truth is, you are neither right nor wrong because people agree with you. You’re right because your facts and reasoning are right.
Louann Lofton (Warren Buffett Invests Like a Girl: And Why You Should Too)
Ben Graham taught me 45 years ago that in investing it is not necessary to do extraordinary things to get extraordinary results. In later life, I have been surprised to find that this statement holds true in business management as well. What a manager must do is handle the basics well and not get diverted.” -1994 letter
Mark Gavagan (Gems from Warren Buffett - Wit and Wisdom from 34 Years of Letters to Shareholders)
An investment philosophy is a set of beliefs about: the nature of investment reality: how markets work, why prices move; a theory of value, including how value can be identified, and what causes profits and losses; and the nature of a good investment.
Mark Tier (The Winning Investment Habits of Warren Buffett & George Soros: Harness the Investment Genius of the World's Richest Investors)
The definition of a great company is one that will be great for 25 or 30 years.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
We intend to continue our practice of working only with people whom we like and admire.
Robert L. Bloch (My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World's Most Successful Investor)
Alternatives include Brookfield Asset Management, Fairfax Financial, Leucadia National, Loews Companies, Markel Corporation, and White Mountains Insurance. While these companies meet Buffett-style compensation criteria, some public investment vehicles have married hedge-fund-style compensation with a value investment approach. Examples include Greenlight Capital Re and Biglari Holdings.
John Mihaljevic (The Manual of Ideas: The Proven Framework for Finding the Best Value Investments)
The best education you can get is investing in yourself. But this doesn’t always mean college or university.
George Ilian (Warren Buffett: The Life and Business Lessons of Warren Buffett)
The profound point is that the critical link between growth and value creation is the return on incremental capital. Since share prices tend to follow earnings over the long term, the more capital that can be deployed at high rates of return to drive greater earnings growth, the more valuable a company becomes. Warren Buffett summarized the point best: “Leaving the question of price aside, the best business to own is one that over an extended period can employ large amounts of incremental capital at very high rates of return.”4 The best investments, in other words, combine strong growth with high returns on capital.
Lawrence A. Cunningham (Quality Investing: Owning the Best Companies for the Long Term)
you can simply buy wonderful companies at reasonable prices, and let those companies compound cash over long periods of time. Surprisingly, there aren’t all that many money managers who follow this strategy, even though it’s the one used by some of the world’s most successful investors. (Warren Buffett is the best-known.)
Pat Dorsey (The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments (Little Books. Big Profits))
When management with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact’ Warren Buffett
Anthony Bolton (Investing Against the Tide: Lessons From a Life Running Money)
The willingness and ability to see investment capital as completely fungible, whether it is capital tied up in the assets of a businesses or capital that’s invested in securities, is an exceedingly rare trait. With
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
It doesn’t work that way … we have to work extremely hard to find just a very few attractive investment situations.” The
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
Graham paid up for quality when he bought the insurance company GEICO—he ended up making more profits from that single investment than he did from all his other activities combined.16 Tom
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
You can gain great insights about investing from a careful study of Buffett’s Generals. He was constantly appraising the value of as many stocks as he could find, looking for the ones where he felt he had a reasonable ability to understand the business and come up with an estimate for its worth. With a prodigious memory and many years of intense study, he built up an expansive memory bank full of these appraisals and opinions on a huge number of companies. Then, when Mr. Market offered one at a sufficiently attractive discount to its appraised value, he bought it; he often concentrated heavily in a handful of the most attractive ones. Good valuation work and proper temperament have always been the two keys pillars of his success as an investor. Buffett
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
I am not in the business of predicting general stock market or business fluctuations. If you think I can do this, or think it is essential to an investment program, you should not be in the partnership.
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
my wife, children and I will have virtually our entire net worth invested in the partnership.4 Everyone
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
In the great majority of cases the lack of performance exceeding or even matching an unmanaged index in no way reflects lack of either intellectual capacity or integrity. I think it is much more the product of: (1) group decisions—my perhaps jaundiced view is that it is close to impossible for outstanding investment management to come from a group of any size with all parties really participating in decisions; (2) a desire to conform to the policies and (to an extent) the portfolios of other large well-regarded organizations; (3) an institutional framework whereby average is “safe” and the personal rewards for independent action are in no way commensurate with the general risk attached to such action; (4) an adherence to certain diversification practices which are irrational; and finally and importantly, (5) inertia.6 Classical
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
The evaluation of securities and businesses for investment purposes has always involved a mixture of qualitative and quantitative factors. At the one extreme, the analyst exclusively oriented to qualitative factors would say, “Buy the right company (with the right prospects, inherent industry conditions, management, etc.) and the price will take care of itself.” On the other hand, the quantitative spokesman would say, “Buy at the right price and the company (and stock) will take care of itself.” As is so often the pleasant result in the securities world, money can be made with either approach. And, of course, any analyst combines the two to some extent—his classification in either school would depend on the relative weight he assigns to the various factors and not to his consideration of one group of factors to the exclusion of the other group. Interestingly enough, although I consider myself to be primarily in the quantitative school (and as I write this no one has come back from recess—I may be the only one left in the class), the really sensational ideas I have had over the years have been heavily weighted toward the qualitative side where I have had a “high-probability insight.” This is what causes the cash register to really sing. However, it is an infrequent occurrence, as insights usually are, and, of course, no insight is required on the quantitative side—the figures should hit you over the head with a baseball bat. So the really big money tends to be made by investors who are right on qualitative decisions but, at least in my opinion, the more sure money tends to be made on the obvious quantitative decisions. As
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
If a 20% or 30% drop in the market value of your equity holdings (such as BPL) is going to produce emotional or financial distress, you should simply avoid common stock type investments. In the words of the poet—Harry Truman—“If you can’t stand the heat, stay out of the kitchen.” It is preferable, of course, to consider the problem before you enter the “kitchen.
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)
Texaco's unusual situation can be summarized in one sentence, often repeated by Graham and Dodd disciple Warren Buffett: A great investment opportunity occurs when a marvelous business encounters a onetime huge, but solvable, problem.
Benjamin Graham (Security Analysis: Principles and Technique)
Ben Graham taught me 45 years ago that in investing it is not necessary to do extraordinary things to get extraordinary results. In later life, I have been surprised to find that this statement holds true in business management as well. What a manager must do is handle the basics
Mark Gavagan (Gems from Warren Buffett - Wit and Wisdom from 34 Years of Letters to Shareholders)
investment
Mark Gavagan (Gems from Warren Buffett - Wit and Wisdom from 34 Years of Letters to Shareholders)
Bull markets are immense fun, until they cease to be immense fun.
Ashton Marshall (Warren Buffett: Investing & Life Lessons On How To Get Rich, Become Successful & Dominate Your Personal Finance From The Greatest Value Investor Of All ... Men, Success Principles, Business Advice))
You can be highly successful as an investor without having the slightest ability to value an option. What students should be learning is how to value a business. That’s what investing is all about.
Mark Gavagan (Gems from Warren Buffett - Wit and Wisdom from 34 Years of Letters to Shareholders)
We purchased several companies whose earnings will almost certainly decline this year from peaks they reached in 1999 or 2000. The declines make no difference to us, given that we expect all of our businesses to now and then have ups and downs. (Only in the sales presentations of investment banks do earnings move forever upward.)” -2000 letter
Mark Gavagan (Gems from Warren Buffett - Wit and Wisdom from 34 Years of Letters to Shareholders)
When you have identified your long-term objectives, defined your tolerance for risk, and carefully selected an index fund or a small number of actively managed funds that meet your goals, stay the course. Hold tight. Complicating the investment process merely clutters the mind, too often bringing emotion into a financial plan that cries out for rationality. I am absolutely persuaded that investors’ emotions, such as greed and fear, exuberance and hope—if translated into rash actions—can be every bit as destructive to investment performance as inferior market returns. To reiterate what the estimable Mr. Buffett said earlier: “Inactivity strikes us as intelligent behavior.” Never forget it.
John C. Bogle (Common Sense on Mutual Funds)
But it is the long-term merits of the index fund—broad diversification, weightings paralleling those of the stocks that comprise the market, minimal portfolio turnover, and low cost—that commend it to wise investors. Consider these words from perhaps the wisest investor of all, Warren E. Buffett, from the 1996 Annual Report of Berkshire Hathaway Corporation: Most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that charges minimal fees. Those following this path are sure to beat the net results (after fees and expenses) delivered by the great majority of investment professionals.
John C. Bogle (Common Sense on Mutual Funds)
a declining Dow gives us our chance to shine and pile up the percentage advantages which, coupled with only an average performance during advancing markets, will give us quite satisfactory long-term results. Our target is an approximately ½% decline for each 1% decline in the Dow and if achieved, means we have a considerably more conservative vehicle for investment in stocks than practically any alternative.8 Buffett
Jeremy Miller (Warren Buffett's Ground Rules: Words of Wisdom from the Partnership Letters of the World's Greatest Investor)