Warren Buffett's 23 Best Quotes About Investing
REUTERS/Rick Wilking
We compiled a few of Buffett's best quotes from his TV appearances, newspaper op-eds, magazine interviews, and of course his annual letters.
Investing novices and experts alike can learn from the advice that the he has articulated through the years.
If we've missed any of your favorites, let us know in the comments.
Buying a stock is about more than just the price.
Source: Letter to shareholders, 1989
You don't have to be a genius to invest well.
AP Photo
Source: Warren Buffet Speaks, via msnbc.msn
But, master the basics.
REUTERS/Jim Young
Source: Chairman's Letter, 1996
Don't buy a stock just because everyone hates it.
"None of this means, however, that a business or stock is an intelligent purchase simply because it is unpopular; a contrarian approach is just as foolish as a follow-the-crowd strategy.
What's required is thinking rather than polling. Unfortunately,
Bertrand Russell's observation about life in general applies with
unusual force in the financial world: "Most men would rather die than
think. Many do."
Source: Chairman's Letter, 1990
Source: Chairman's Letter, 1990
Bad things aren't obvious when times are good.
"After all, you only find out who is swimming naked when the tide goes out."
Source: Letter to shareholders, 2001
Source: Letter to shareholders, 2001
Always be liquid.
"I have pledged – to you, the rating agencies and myself – to always run Berkshire with more than ample cash. We never want to count on the kindness of strangers in order to meet tomorrow’s obligations. When forced to choose, I will not trade even a night’s sleep for the chance of extra profits."
Source: Letter to shareholders, 2008
Source: Letter to shareholders, 2008
The best time to buy a company is when it's in trouble.
Reuters
Source: Businessweek, 1999
Stocks have always come out of crises.
AP
Source: The New York Times, October 16, 2008
Don't be fooled by that Cinderella feeling you get from great returns.
"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 ¾
that is, continuing to speculate in companies that have gigantic
valuations relative to the cash they are likely to generate in the
future ¾ 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."
Source: Letter to shareholders, 2000
Source: Letter to shareholders, 2000
Think long-term.
"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. You must also resist the temptation to stray
from your guidelines: If you aren't willing to own a stock for ten years, don't even think about owning it for ten minutes.
Put together a portfolio of companies whose aggregate earnings march
upward over the years, and so also will the portfolio's market value."
Source: Chairman's Letter, 1996
Source: Chairman's Letter, 1996
Forever is a good holding period.
"When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever."
Source: Letter to shareholders, 1988
Source: Letter to shareholders, 1988
Buy businesses that can be run by idiots.
"I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will."
Source: Business Insider
Source: Business Insider
Be greedy when others are fearful.
"Investors
should remember that excitement and expenses are their enemies. And if
they insist on trying to time their participation in equities, they
should try to be fearful when others are greedy and greedy only when others are fearful."
Source: Letter to shareholders, 2004
Source: Letter to shareholders, 2004
You don't have to move at every opportunity.
"The stock market is a no-called-strike game. You don't have to swing at everything--you can wait for your pitch. The problem when you're a money manager is that your fans keep yelling, 'Swing, you bum!'"
Source: The Tao of Warren Buffett via Engineeringnews.com
Source: The Tao of Warren Buffett via Engineeringnews.com
Ignore politics and macroeconomics when picking stocks.
AP Photo/Horst Faas
"But, surprise - none of these blockbuster events made the slightest dent in Ben Graham's investment principles. Nor did they render unsound the negotiated purchases of fine businesses at sensible prices. Imagine the cost to us, then, if we had let a fear of unknowns cause us to defer or alter the deployment of capital. Indeed, we have usually made our best purchases when apprehensions about some macro event were at a peak. Fear is the foe of the faddist, but the friend of the fundamentalist.
Source: Chairman's Letter, 1994
The more you trade, the more you underperform.
"Long
ago, Sir Isaac Newton gave us three laws of motion, which were the work
of genius. But Sir Isaac’s talents didn’t extend to investing: He lost a
bundle in the South Sea Bubble, explaining later, “I can calculate the
movement of the stars, but not the madness of men.” If he had not been
traumatized by this loss, Sir Isaac might well have gone on to discover
the Fourth Law of Motion: For investors as a whole, returns decrease as motion increases."
Source: Letters to shareholders, 2005
Source: Letters to shareholders, 2005
Price and value are not the same
REUTERS/Eric Gaillard
Source: Letter to shareholders, 2008
There are no bonus points for complicated investments.
REUTERS/Kai Pfaffenbach
"Investors should remember that their scorecard is not computed using Olympic-diving methods: Degree-of-difficulty doesn’t count. If you are right about a business whole value is largely dependent on a single key factor that is both easy to understand and enduring, the payoff is the same as if you had correctly analyzed an investment alternative characterized by many constantly shifting and complex variables."
Source: Chairman's Letter, 1994
A good businessperson makes a good investor.
REUTERS/James Lawler Duggan
Source: Forbes.com - Thoughts On The Business Life
Higher taxes aren't a dealbreaker.
"SUPPOSE
that an investor you admire and trust comes to you with an investment
idea. “This is a good one,” he says enthusiastically. “I’m in it, and I
think you should be, too.”
Would your reply possibly be this? “Well, it all depends on what my tax rate will be on the gain you’re saying we’re going to make. If the taxes are too high, I would rather leave the money in my savings account, earning a quarter of 1 percent.” Only in Grover Norquist’s imagination does such a response exist."
Source: New York Times
Would your reply possibly be this? “Well, it all depends on what my tax rate will be on the gain you’re saying we’re going to make. If the taxes are too high, I would rather leave the money in my savings account, earning a quarter of 1 percent.” Only in Grover Norquist’s imagination does such a response exist."
Source: New York Times
Companies that don't change can be great investments.
Wikimedia Commons
Source: Businessweek, 1999
Time will tell.
"Time is the friend of the wonderful business, the enemy of the mediocre."
Source: Letters to shareholders 1989
Source: Letters to shareholders 1989
This is the most important thing.
"Rule No. 1: never lose money; rule No. 2: don't forget rule No. 1"
Source: The Tao of Warren Buffett
Source: The Tao of Warren Buffett
No comments:
Post a Comment