Warren Buffett’s Investment Advice

“Investment is most intelligent when it is most businesslike.” — The Intelligent Investor by Benjamin Graham

 

Warren Buffett’s “certain fundamentals of investing”:

  • Keep it simple and steady: “When promised quick profits, respond with a quick ‘no.'”
  • Focus on the big picture: “Focus on the future productivity of the asset you are considering. If you don’t feel comfortable making a rough estimate of the asset’s future earnings, just forget it and move on.”
  • Don’t speculate: “Half of all coin-flippers will win their first toss; none of those winners has an expectation of profit if he continues to play the game. And the fact that a given asset has appreciated in the recent past is never a reason to buy it.”
  • Don’t obsess over the small picture: “Games are won by players who focus on the playing field — not by those whose eyes are glued to the scoreboard. If you can enjoy Saturdays and Sundays without looking at stock prices, give it a try on weekdays.”
  • Market predictions are a waste of time: “Forming macro opinions or listening to the macro or market predictions of others is a waste of time. Indeed, it is dangerous because it may blur your vision of the facts that are truly important.”
* Excerpts from his 2014 Berkshire Hathaway annual shareholder’s report http://www.berkshirehathaway.com/letters/2013ltr.pdf

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