Priceless Nuggets Of Financial Wisdom, Courtesy Of Warren Buffet
Investing is definitely not your typical game. You can gain millions, or even billions at the snap of a finger and equally lose as much or even more if you fail. There are a lot of experts in this field but, surely, the best investor ever born is a man named Warren Buffett. People listen to what he has to say about investments as he has been considered having an eagle’s eyesight when it comes to which investments will bloom and which will not. Here are some nuggets of his wisdom that we all can learn from.
Temperament is the Most Important Quality
You know about hard work, a good financial IQ and a stroke of luck. Warren Buffett himself would agree that all these are essential to getting rich, but what he finds most important could be quite striking. “The most important quality for an investor is temperament, not intellect” says the investing genius. “You need a temperament that neither derives great pleasure from being with the crowd or against the crowd,” he adds.
True enough, Buffett has a temperament that has been considered by his peers as observant but calm. Buffett had one of the greatest investment IQs of this generation and he could tell when a certain company would fail or would make it big.
[su_quote cite=”Warren Buffett” class=”cust-pagination”]”Price is what you pay. Value is what you get.”[/su_quote]
Don’t Be A Yes Man
“The difference between successful people and really successful people is that really successful people say no to almost everything,” says Buffet. True enough, numerous greats in investing such as Bill Gates, Steve Jobs and Warren Buffett himself have attributed their success to focusing. While most people would have a list of things to do and work on becoming more productive, having a list of things that should not be done is also important if you want to be something big later on.
“It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.”
This was said by Buffet in a 1989 letter to shareholders and is one of his most famous quotes. As simple as it looks, this reflects one of the most basic principles of his investment strategy.
Buffett sticks to companies that he can fully understand and those for which the value is very evident, regardless of the state of their finances. This philosophy has served him very well. If he did not have the attitude of giving away vast amounts of his wealth to charity, he would easily be the single richest man in the world.
“Try to buy stock in businesses that are so wonderful that an idiot can run them because sooner or later one will.”
Warren Buffett said this quite at a panel discussion after the premier of the documentary “IOUSA.” Buffett knows all of his investments very clearly like the back of his hand. He started out as a young boy selling chewing gum at Omaha, Nebraska, to selling cartons of Coca Cola, until he peaked when he founded Berkshire-Hathaway. His mammoth company is the parent company of a Dairy Queen, Heinz, Fruit of the Loom and many others.
“Be fearful when others are greedy. Be greedy when others are fearful”
It is a gross oversimplification to say that the real deal in investing is to buy when stocks are low and sell them when the prices are high. Warren Buffett considers this principle as his secret to becoming rich, and it has served him and a lot of his juniors well. A lot of the most successful investments could be sourced from this quote alone and this could be a solid basis for how you can get out of a bubble.
The best way to learn how to invest is just to go ahead and do it. There are a lot of books, podcasts and videos available everywhere right now, but you can never get away without learning from the best. Warren Buffet is definitely a man you should listen to, even when investing is not really your cup of tea. What do you think of some of Mr. Buffett’s lessons? Share with us your thoughts in the comments below!
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