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| Wise Investing |
Warren Buffet needs no introduction. He is one of the wealthiest men in the world today - that is despite donating and pledging a large part of his wealth to charitable foundations. He is popularly known as Oracle of Omaha / Sage of Omaha / Wizard of Omaha and is one of the most successful investment gurus and respected business persons of the world. He was born in Nebraska on 30 August 1930. He first purchased stock at the age of 11 and filed taxes at age 13. He is synonymous with Berkshire Hathaway which he assumed control in 1965 and was pivotal in its expansion into one of the largest conglomerates in the world. Today, the organisation has holdings in media, insurance, energy, food and beverage industries. His current net worth is estimated by Forbes to be approximately US$ 89 Billion.
Apart from his meteoric rise to one of the richest and most celebrated philanthropist men in the world, Warren Buffet is also famous for his inspiring and insightful quotes in the world of investing. Each of his quotes is a pearl of wisdom for potential and existing investors on wise investing. Here are some of those wonderful quotes.
- Saving: “Do not save what is left after spending, but spend what is left after saving.”
- Earning: “Never depend on single income. Make investment to create a second source.”
- Spending: “If you buy things you do not need, soon you will have to sell things you need.”
- Investment: “Do not put all your eggs in one basket.”
- Success: “You do things when the opportunities come along. I’ve had periods in my life when I’ve had a bundle of ideas come along, and I’ve had long dry spells. If I get an idea next week, I’ll do something. If not, I won’t do a damn thing.”
- Risk: “Never test the depth of river with both the feet.”
- Expectation: “Honesty is very expensive gift. Do not expect it from cheap people.”
- Humanity: “If you’re in the luckiest 1 per cent of humanity, you owe it to the rest of humanity to think about the other 99 percent.”
- “A climate of fear is your friend when investing; a euphoric world is your enemy.”
- “A great investment opportunity occurs when a marvelous business encounters a one-time huge, but solvable problem.“
- “A hyperactive stock market is the pickpocket of enterprise.“
- “A prediction about the direction of the stock market tells you nothing about where stocks are headed, but a whole lot about the person doing the predicting.”
- “A public-opinion poll is no substitute for thought.”
- “Always invest for the long term.”
- “An investor needs to do very few things right as long as he or she avoids big mistakes.“
- “An investor should ordinarily hold a small piece of an outstanding business with the same tenacity that an owner would exhibit if he owned all of that business.”
- “Anything can happen in stock markets and you ought to conduct your affairs so that if the most extraordinary events happen, that you’re still around to play the next day.“
- “As Buffet said in the speech, “He’s not looking at quarterly earnings projections, he’s not looking at next year’s earnings, he’s not thinking about what day of the week it is, he doesn’t care what investment research from any place says, he’s not interested in price momentum, volume or anything. He’s simply asking: What is the business worth?”
- “Buy a business, don’t rent stocks.”
- “Buy companies with strong histories of profitability and with a dominant business franchise.”
- “By periodically investing in an index fund, the know-nothing investors can actually outperform most investment professionals.”
- “Cash never makes us happy, but it’s better to have the money burning a hole in Berkshire’s pocket than resting comfortably in someone else’s.”
- “Chains of habits are too light to be felt until they are too heavy to be broken.”
- “Diversification is a protection against ignorance. It makes very little sense for those who know what they’re doing.”
- “Diversification may preserve wealth, but concentration builds wealth.”
- “Do a lot of reading.” – on how to determine the value of a business
- “Enjoy your work and work for whom you admire.“
- “For some reason, people take their cues from price action rather than from values. What doesn’t work is when you start doing things that you don’t understand or because they worked last week for somebody else. The dumbest reason in the world to buy a stock is because it’s going up.”
- “Great investment opportunities come around when excellent companies are surrounded by unusual circumstances that cause the stock to be misappraised.”
- “I always knew I was going to be rich. I don’t think I ever doubted it for a minute.“
- “I am a better investor because I am a businessman and a better businessman because I am an investor.”
- “I do not like debt and do not like to invest in companies that have too much debt, particularly long-term debt. With long-term debt, increases in interest rates can drastically affect company profits and make future cash flows less predictable.“
- “I don’t look to jump over 7-foot bars: I look around for 1-foot bars that I can step over.”
- “I don’t measure my life by the money I’ve made. Other people might, but certainly don’t.“
- “I have pledged… to always run Berkshire with more than ample cash… I will not trade even a night’s sleep for the chance of extra profits.”
- “I knew a lot about what I did when I was 20. I had read a lot, and I aspired to learn everything I could about the subject.”
- “I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for ten years.”
- “I never buy anything unless I can fill out on a piece of paper my reasons. I may be wrong, but I would know the answer to that …I’m paying $32 billion today for the Coca Cola Company because… If you can’t answer that question, you shouldn’t buy it. If you can answer that question, and you do it a few times, you’ll make a lot of money.“
- “I really like my life. I’ve arranged my life so that I can do what I want.”
- “I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.”
- “I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.”
- “If a business does well, the stock eventually follows.”
- “If at first you do succeed, quit trying on investing.“
- “If you don’t feel comfortable owning something for 10 years, then don’t own it for 10 minutes.”
- “In a commodity business, it’s very hard to be smarter than your dumbest competitor.“
- “In the business world, the rearview mirror is always clearer than the windshield.”
- “Investing is laying out money now to get more money back in the future.”
- “Investors making purchases in an overheated market need to recognize that it may often take an extended period for the value of even an outstanding company to catch up with the price they paid.”
- “It is not necessary to do extraordinary things to get extraordinary results.”
- “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.”
- “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.”
- “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.“
- “It’s not debt per say that overwhelms an individual corporation or country. Rather it is a continuous increase in debt in relation to income that causes trouble.“
- “It’s us fun being a gorse when the tractor comes along, or the blacksmith when the car comes along.“
- “Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it.“
- “Money is not everything. Make sure you earn a lot before speaking such nonsense.”
- “Money to some extent sometimes let you be in more interesting environments. But it can’t change how many people love you or how healthy you are.“
- “Most people get interested in stocks when everyone else is. The time to get interested is when no one else is. You can’t buy what is popular and do well.”
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| Wise Investing |
- “Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good results.”
- “Never give up searching for the job that you’re passionate about. Try to find the job you’d have if you were independently rich. Forget about the pay. When you’re associating with the people that you love, doing what you love, it doesn’t get any better than that.”
- “Never invest in a business you cannot understand.”
- “No matter how great the talent or efforts, some things just take time. You can’t produce a baby in one month by getting nine women pregnant.”
- “Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”
- “Only those who will be sellers of equities in the near future should be happy at seeing stocks rise. Prospective purchasers should much prefer sinking prices.”
- “Only when the tide goes out do you discover who’s been swimming naked.“
- “Our approach is very much profiting from lack of change rather than from change. With Wrigley chewing gum, it’s the lack of change that appeals to me. I don’t think it is going to be hurt by the Internet. That’s the kind of business I like.”
- “Our favorite holding period is forever.”
- “Price is what you pay. Value is what you get.”
- “Read Ben Graham and Phil Fisher read annual reports, but don’t do equations with Greek letters in them.“
- “Risk can be greatly reduced by concentrating on only a few holdings.”
- “Risk comes from not knowing what you’re doing.”
- “Somebody once said that in looking for people to hire, you look for three qualities: integrity, intelligence, and energy. And if you don’t have the first, the other two will kill you. You think about it; it’s true. If you hire somebody without [integrity], you really want them to be dumb and lazy.”
- “Someone’s sitting in the shade today because someone planted a tree a long time ago.”
- “Stop trying to predict the direction of the stock market, the economy, interest rates, or elections.”
- “The best business returns are usually achieved by companies that are doing something quite similar today to what they were doing five or ten years ago.”
- “The business schools reward complex behavior more than simple behavior, but simple behavior is more effective.“
- “The critical investment factor is determining the intrinsic value of a business and paying a fair or bargain price.”
- “The fact that people will be full of greed, fear, or folly is predictable. The sequence is not predictable.“
- “The first rule is not to lose. The second rule is not to forget the first rule.”
- “The investor of today does not profit from yesterday’s growth.“
- “The most important thing to do if you find yourself in a hole is to stop digging.”
- “The stock market is a no-called-strike game. You don’t have to swing at everything – you can wait for your pitch.”
- “The Stock Market is designed to transfer money from the Active to the Patient.”
- “Time is the friend of the wonderful company, the enemy of the mediocre.“
- “Turnarounds seldom turn.“
- “Unless you can watch your stock holding decline by 50% without becoming panic-stricken, you should not be in the stock market.”
- “Valuing a business is part art and part science.“
- “Wall Street is the only place that people ride to in a Rolls-Royce to get advice from those who take the subway.”
- “We don’t get paid for activity, just for being right. As to how long we will wait, we’ll wait indefinitely.”
- “We have long felt that the only value of stock forecasters is to make fortune-tellers look good.”
- “We like to buy businesses, but we don’t like to sell them.“
- “We will have another bubble, but usually you don’t get it the same way you got it before.”
- “We will only do with your money what we would do with our own.”
- “We will reject interesting opportunities rather than over-leverage our balance sheet.“
- “What we learn from history is that people don’t learn from history.”
- “When a management team with a reputation for brilliance joins a business with poor fundamental economics, it is the reputation of the business that remains intact.”
- “When asked how he became so successful in investing, Buffett answered: ‘we read hundreds and hundreds of annual reports every year.”
- “Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.”
- “Why not invest your assets in the companies you really like? As Mae West said, ‘Too much of a good thing can be wonderful.”
- “Wide diversification is only required when investors do not understand what they are doing.”
- “With enough insider information and a million dollars, you can go broke in a year.“
- “With few exceptions when a manager with a reputation for brilliance tackles a business with a reputation for poor economics, it is the reputation of the business which remains intact.“
- “You do not adequately protect yourself by being half awake when other are sleeping.“
- “You don’t need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ.”
- “You only have to do a very few things right in your life so long as you don’t do too many things wrong.“
- “You ought to be able to explain why you’re taking the job you’re taking, why you’re making the investment you’re making, or whatever it may be. And if it can’t stand applying pencil to paper, you’d better think it through some more. And if you can’t write an intelligent answer to those questions, don’t do it.“
- “You shouldn’t own common stocks if a 50 per cent decrease in their value in a short period of time would cause you acute distress.“
- “You won’t keep control of your time, unless you can say ‘no.’ You can’t let other people set your agenda in life.”
- “You’re neither right nor wrong because other people agree with you. You’re right because your facts are right and your reasoning is right – that’s the only thing that makes you right. And if your facts and reasoning are right, you don’t have to worry about anybody else.”
