Worth over $84 billion dollars and arguably one of the greatest investors of all time, Warren Buffett has earned the nickname, the “Oracle of Omaha.” Buffett follows Graham’s school of value investing. The value investor seeks out stocks with a value that the majority of buyers do not recognize.
Buffett chooses to invest in companies that will make money over the long term. His investment philosophy remains unconcerned with short-term gains or the ups and downs of the daily stock market. Instead, Buffett finds value in companies that have the ability to provide value over the long term.
Here are three nuggets of wisdom from the 87-year-old “Sage of Omaha”:
“Beware the investment activity that produces applause; the great moves are usually greeted by yawns.”
Trends come and go. Predictions fail. The latest big new big thing will likely be forgotten in a year or two. Instead, Buffett advises selecting stock that has long-term potential. These rarely have flash or buzz.
<strong>”Only buy something you’d be perfectly happy to hold if the market shut down for ten years.”</strong>
Warren Buffett says that investors should avoid investing in a business that they do not understand. Investors should invest in companies that do what interests them. Companies that they find interesting. Companies that they want to steer over time.
“Price is what you pay. Value is what you get.”
How much an investment cost does not sum up its worth. A sustainable business, built on a great reputation and will still be profitable in thirty years holds more value than a company where an investor will make a billion dollars in a few years but will be obsolete shortly after.
Though there are critics of Warren Buffett’s investment style and philosophy, he remains one of the world’s richest people.