3 Impressive Warren Buffett Quotes For Investors
Would you pay US$2.68 million to have a private lunch with Warren Buffett? This is what an anonymous winning bidder paid a few months ago. The fundraiser has become a yearly affair as Warren Buffett auctions off a few hours of his time to raise money for Glide Foundation, a San Francisco charity that serves meals to the homeless.
Although this year’s winning bid was some way short of last year’s winning bid of US$3.45million, it is still a hefty sum to pay. Yet, according to an article by Bloomberg, the sum may actually make economical sense if he gives you the secret recipe to Berkshire’s 19% annualised return.
In light of this, I have decided to share some quotes from the great investor that we can all learn from. Some of the best advice that Buffett has given to retail investors can be found in his little sound bites during interviews or his letters to the Berkshire shareholders
1. “Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years”
As with all investing decisions, time should be your friend, and the longer you hold on to a share of a company, the better your returns would be. This emphasizes Warren Buffett’s view that our investment decisions should be based on a long-term approach instead of a hit-and-run mentality.
2. “I bought a company in the mid-‘90s called Dexter Shoe and paid $400 million worth of Berkshire stock, which is probably worth $400 billion. But I’ve made lots of dumb decisions. That’s part of the game.”
Everyone makes mistakes. Even the Oracle of Omaha has and he is regarded as one of the greatest investors ever. This should not be a warning to stay away from the stock market because even Warren Buffett, himself, can make mistakes. Instead, we should take heart when we do make mistakes, as mistakes are part of investing. The most important thing is that once we have identified the mistake, we need to find out where we have gone wrong and try to minimise the chance of making the same mistakes twice.
3. “An investor should act as though he had a lifetime decision card with just twenty punches on it.”
This sums up Warren Buffett’s approach to investing perfectly. Each investment decision we make should be taken carefully. If we are to treat our investments as though we could only choose 20 stocks over our lifetime, we would be extremely careful on which stocks we choose to invest in.
Many people will mull over buying a pair of shoes or a new shirt for days, searching the Internet for bargains. When it comes to the stock market, the amount of effort we put in choosing a stock to purchase should be no different.
The Foolish Bottom Line
Warren Buffett has been an inspiration to many retail and professional investors alike. We are lucky to have such a successful investor willing to share his secrets to success through the numerous interviews and letters he has written. Hopefully, we, as investors make use of his vast amount of knowledge to improve our own investing.