Post by candy188 on Oct 30, 2013 11:48:12 GMT 7
Concur with the view of the writer that Action still constitute the vital element towards fruitful investment success.Buffettology: Warren Buffett Quotes & Value Investment Strategy for Stock Picks
By Kurtis Hemmerling Secrets to Investing Success
Since Warren Buffett has never personally penned an investment book for the masses, how does one go about learning his secrets? Luckily, many of his letters to shareholders, books that compile such letters, and insights from those close to him are readily available to the public.Clearly, Warren Buffet is a value investor.
He looks for great companies, or “wonderful”
ones as he puts it. He is NOT looking at hot sectors or stocks that may shoot up now, only to cool and fall later. He wants an efficient running business that has favorable long-term prospects.
Additionally, although he wants great stocks, he does not want to pay a premium price.
Warren uses a specific calculation to arrive at a fair valuation, then waits until a market correction or crash puts those prices on his doorstep.many people who love the “Warren Buffett investing style” choose to invest on their own. If you are excited by
~~ due diligence,
~~~ scanning thousands of stocks for that highly profitable (and oftentimes mundane) business,
~~~~ forecasting company earnings,
~~~~~ and monitoring the company’s progress, then the “Warren Buffett investment method” may be a perfect fit for you.
==> Remember, perhaps above all else, to have GUTS of steel when the Market Drops so that you can buy UNDERVALUED and PROFITABLE stocks.Full detail of the article:www.moneycrashers.com/buffettology-warren-buffet-quotes-investment-strategy-stock-picks/List of Warren Buffett's current portfoliowww.gurufocus.com/holdings.php?GuruName=Warren+Buffett
Post by candy188 on Nov 2, 2013 9:30:31 GMT 7
Buffett Is Right On Gold Investing
Nov 1 2013, 09:29"Gold
- gets dug out of the ground in Africa, or someplace.
- Then we melt it down,
- dig another hole,
- bury it again
- and pay people to stand around guarding it.
It has no utility.
Anyone watching from Mars would be scratching their head" Warren Buffett
For a few years, gold held its own as an unusual yet promising investment. Recent events have highlighted the oddness and volatility of the gold market. For thousands of years, gold has maintained its status as a nearly universal medium of exchange. No matter how widely they traveled, past explorers like Marco Polo could rely on bullion to purchase food, shelter and other necessities.
Relatively lightweight and portable for such a valuable metal, gold is a durable commodity that is often passed on through generations.
Despite these advantages, gold is a specialized commodity with surprisingly few practical uses.
Although gold does have some industrial applications, copper is far more useful in commercial and industrial contexts. Consumable foodstuffs are more versatile commodities due to tremendous fundamental demand.
Despite the demand for gold jewelry, gold is still a highly specialized commodity that is primarily used for maintaining wealth.
With such a specialized role in society, gold may well continue to experience unpredictable spikes and dips in value.seekingalpha.com/article/1797332-buffett-is-right-on-gold-investing?source=email_rt_article_readmore
Post by candy188 on Nov 2, 2013 10:30:59 GMT 7
Insightful view of Warren Buffett to invest in businesses with strong underlying fundamental value through enjoying the benefits of both the capital gain & dividend payments. Warren Buffett in annual report, 2011:
2 Categories of investment possibilities enjoy maximum popularity at peaks of fear:
~~ Terror over Economic Collapse drives individuals to currency-based assets, most particularly U.S. Obligations, and
~~~~ fear of Currency collapse fosters movement to sterile assets such as gold.
We heard “cash is KING” in late 2008, just when cash should be deployed rather than held.
Similarly, we heard “cash is TRASH” in the early 1980s just when fixed-dollar investments were at their most attractive level in memory.
On these occasions, investors who required a supportive crowd paid dearly for that comfort.(1) Investments that are denominated in a given currency include money-market funds, bonds, mortgages, bank deposits, and other instruments.
Most of these currency-based investments are thought of as ‘safe.”
In truth, they are among the MOST DANGEROUS of assets.
Their beta may be zero, but their Risk is huge.
Over the past century these instruments have destroyed the purchasing power of investors
in many countries, even as the holders continued to receive timely payments of interest and principal. This ugly result, moreover, will forever recur. Governments determine the ultimate value of money, and systemic forces will sometimes cause them to gravitate to policies that produce inflation. From time to time such policies span out of control.
Even in the U.S., where the wish for a stable currency is strong, the dollar has fallen a staggering 86% in value since 1965, when I took over management of Berkshire. It takes no less than $7 today to buy what $1 I did at that time.
Under today’s conditions, therefore, I do not like currency-based investments. Even so, Berkshire holds significant amounts of them, primarily of the short-term variety.
We primarily hold U.S. Treasury bills, the only investment that can be counted on for liquidity under the most chaotic of economic conditions. Our working level for liquidity is $20 billion; $10 billion is our absolute minimum.(2) Second major category of investments involves asset that will NEVER PRODUCE ANYTHING, but that are purchased in the buyer’s HOPE that Someone else - who also knows that the assets will be Forever Unproductive – will Pay More for them in the future.
Tulips, of all things, briefly became a favorite of such buyers in the 17th century.
- This type of investment requires an expanding pool of buyers, who in turn, are enticed because they believe the buying pool will expand still futher.
- Owners are NOT inspired by what the asset itself can produce – it will remain lifeless forever – but rather by the belief that others will desire it even more avidly in the future.The major asset in this category is GOLD, currently a huge favorite of investors who fear almost all other assets, especially paper money
(of whose value, as noted, they are right to be fearful). Gold, however, has 2 Significant Shortcomings, neither of much use nor procreative
True, gold has some industrial and decorative utility, but the demand for these purposes is both limited and incapable of soaking up new production. Meanwhile, if you own one ounce of gold for an eternity, you will still own one ounce at its end.What motivates most gold purchasers is their belief that the ranks of the fearful will grow.
During the past decade that belief has proved correct. Beyond that, the rising price has on its own generated additional buying enthusiasm, attracting purchasers who see the rise as validating an investment thesis. As “bandwagon” investors join any party, they create their own truth - for a while.
Over the past 15 years, both Internet stocks and houses have demonstrated the extraordinary excesses that can be created by combining an initially sensible thesis with well-publicized rising prices. In these bubbles, an army of originally skeptical investors succumbed to the “proof” delivered by the market, and the pool of buyers – for a time – expanded sufficiently to keep the bandwagon rolling. But bubbles blown large enough INEVITABLY POP.
And then the old proverb is confirmed once again: “WHAT THE WISE MAN does in the Beginning, the FOOL does in the END.”
My own preference – and you knew this was coming – is our third category: investment in Productive assets, whether BUSINESSES, FARMS, OR REAL ESTATE.
Ideally, these assets should have the ability in inflationary times to Deliver Output that will Retain its Purchasing-Power Value while requiring a minimum of new capital investment.
Farms, real estate, and many businesses such as Coca-Cola, IBM and our own See’s Candy meet that double-barreled test. Certain other companies – think of our regulated utilities, for example – fail it because inflation places heavy capital requirements on them. To earn more, their owners must invest more.
Even so, these investments will remain superior to nonproductive or currency-based assets.Whether the currency a century from now is based on gold, seashells, shark teeth, or a piece of paper (as today), people will be willing to exchange a couple of minutes of their daily labor for a Coca-Cola or some See’s peanut brittle.
In the future the U.S. population will move more goods, consume more food, and require more living space than it does now. People will forever exchange what they produce for what others produce.
Our country’s businesses will continue to efficiently deliver goods and services wanted by our citizens.Metaphorically, these commercial “cows” will live for centuries and give ever greater quantities of “milk” to boot. Their value will be determined not by the medium of exchange but rather by their capacity to deliver milk. Proceeds from the sale of the milk will compound for the owners of the cows, just as they did during the 20th century when the Dow increased from 66 to 11,497 (and paid loads of dividends as well).
will be to increase its ownership of first-class businesses. Our first choice will be to own them in their entirety –
but we will also be owners by way of holding sizable amounts of marketable stocks.
I believe that over any extended period of time this category of investing will prove to be the runaway winner among the three* we’ve examined. More important, it will be by far the safest.
Post by candy188 on Nov 3, 2013 18:43:24 GMT 7
Warren Buffett reiterated the importance of preparation.Warren Buffet’s joke: Don’t believe your own hype.
A few times when investing, we drive ourselves to accept that we have discovered the ideal stock in spite of the fact that we haven’t done the right measure of research it merits.
Warren Buffet imparted a joke making us comprehend how exposed we are to our own particular lies.
Warren Buffet once shared this joke:A very successful oilman dies. He faces Saint Peter, who says,
“You’ve been a good man and normally I’d send you to heaven, but heaven is full. We only have a place in hell.”
The oilman says, “Any chance I could talk to other oilmen who are in heaven? Maybe I can convince someone to switch places with me?”
Saint Peter says, “It’s never happened before, but sure, I don’t see any harm in it.”
The oilman goes to heaven, finds an oilmen convention and yells, “They found a huge oil discovery in hell!”
Oilmen are stampeding out of heaven to hell, and our oilman is running with them. Saint Peter asks him “Why are you going to hell with them? I have a spot in heaven, you can stay.” The oilman answers – “Are you kidding, what if it’s true?
Post by candy188 on Nov 7, 2013 18:46:41 GMT 7
Excerpt of the article on Top 3 investing mistakes to avoid
by Warren Buffett.
With a sizeable trading loss raked up with the Midas touch mindset more than a decade ago, :(I concur wholeheartedly with the sage's golden advice: But to really profit from stocks and build wealth over time,
says Buffett, ==> individual investors must AVOID Making COSTLY Mistakes that Shrink their portfolio balances,
just as a football team that wants to boost their odds of winning must Avoid fumbling the ball away, Throwing an interception or Taking a Penalty at a bad time.
Building wealth in stocks is still the way to go, even though the ride can get bumpy from time to time, Buffett, 83, says.
"Doing reasonably well investing in stocks
," Buffett says, "is very, very easy
"Buy an index fund,
preferably over time, so you end up owing good businesses at a reasonable average price
," says Buffett. "And that is all you have to do."
That's it? It's that simple? Buffett says yes.www.usatoday.com/story/money/personalfinance/2013/10/26/warren-buffett-investment-advice/3188499/
Post by candy188 on Nov 25, 2013 8:44:39 GMT 7
Insightful advices on the slow and steady way towards accumulating riches from investing
shared via valuebuddies forum, rather than the get rick quick scheme actively advertised in the market.If you want to learn about investing, learn from the best - Warren Buffett. Who did Warren learn from? Benjamin Graham and Philip Fisher.
So read the writings of these 3 investing legends. If you can understand and apply their ideas, you will not do poorly, and it is possible that you may do very well indeed.Buffett's writings:
Berkshire Hathaway shareholder letters
The Essays of Warren Buffett
(a compilation of the same letters by Lawrence Cunningham)Graham's writings:
The Intelligent Investor
(a must-read for everyone)Security Analysis
(for professionals)Fisher's writings:
Common Stocks and Uncommon Profits
As for the investment courses, are they run by investors with easily verified track records?
That should give you a clue as to whether the speakers/trainers actually know how to invest.==> People who are successful investors don't normally waste their time running courses - they make far more money using their time to invest. If they Teach at all, it is usually for FREE, to Help Other People.
Anyone who charges meaningful fees is probably making a living from teaching, not investing.
I would suggest reading The Intelligent Investor as a first step.
No less than Warren Buffett himself has endorsed it. After that, learn accounting (either in a school setting or on your own) so that you can understand financial statements.By the way, don't expect to get rich from investing. Investing can compound money to many times its original sum, but if you start with a very small sum it's not going to matter much. To get money for investing you'll need a job that pays enough that you can put aside money to invest.
- So first concentrate on increasing your earning power before you think about investing.
1. Work hard to increase your income
2. Save harder to increase your savings
3. Invest wisely to increase your net worth.
Note the sequence. Investing is not a substitute for your job
- unless you are actually a fund manager.
The list of people who got rich off investing alone is depressingly short, and even the guy at the top of it, Warren Buffett, made his fortune first from business (he was a hedge fund manager and earned fees from his clients). Buffett put $100 into his partnership when he started. When he wound it up he had $25m. That money came from fees, not from merely compounding $100.
In contrast, the rich list is dominated by businessmen. So if you want to get rich, go into business. Investing alone will not make you rich unless you invest money for others, in which case your income is not from your own investments but from the fees you charge.www.valuebuddies.com/archive/index.php?thread-2156-5.html
Post by me200 on Dec 7, 2013 8:05:53 GMT 7
Buffett's rewarding stock pickswww.bloomberg.com/news/2013-12-06/warren-buffett-market-beating-skills-revealed-cutting-research.html
LONDON - Billionaire Warren Buffett is not just a great investor. He is the best investor, an economic study has found.
An index measuring returns adjusted by price fluctuations shows the chairman and chief executive officer of Berkshire Hathaway has done better than every long-lived US stock and mutual fund.
Looking at all US stocks from 1926 to 2011 that have been traded for more than 30 years, a paper published this week by the National Bureau of Economic Research calculated that Mr Buffett's so- called Sharpe ratio is 0.76 since 1976. That was about twice the stock market's 0.39.
The ratio is also larger than all 196 US mutual funds that have been around for 30 years. The median Sharpe ratio for them is 0.37.
The review of Mr Buffett's investments concluded that he has been rewarded for his use of leverage, coupled with a focus on cheap, safe, quality shares.
Mr Buffett is willing to take on borrowing to finance investment
, then picks stocks that have low volatility
, are cheap
- with low price-to-book ratios
- and are high quality
, meaning they are profitable and have high payouts.
By breaking down Berkshire Hathaway's portfolio into ownership of publicly traded stocks versus wholly owned private companies, the study found the tradable equities performed best. That suggested Mr Buffett's returns are due more to stock selection than to the pressure he puts on companies he has stakes in to improve their management.
"If you travel back in time and pick one stock in 1976, Berkshire would be your pick," it said.
Post by candy188 on Dec 13, 2013 16:13:36 GMT 7
Easy to say Buy Low Sell High, but in investing Majority find the reverse easier to practise.
I am learning to control the emotional attachment that ruin my opportunity to attain millionaire after numerous rounds of roller coaster rides. Warren Buffett: Top 3 investing mistakes to avoid
Adam Shell, USA TODAY 6:06 a.m. EDT October 26, 2013Imagine having Warren Buffett as your personal financial adviser. USA TODAY asked the Oracle of Omaha to put on his personal finance hat and tick off the biggest mistakes investors make.
NEW YORK — Warren Buffett, the billionaire investor with the Midas touch, has a message for Main Street stock investors: "Don't beat yourself."
"The nice thing about investing in stocks is that, over time, equities are going to do well," Buffett tells USA TODAY.
"American business is going to do well. America is going to do well. So you have the tide with you."Building wealth in stocks is still the way to go, even though the ride can get bumpy from time to time,
Buffett, 83, says.But to really profit from stocks and build wealth over time, says Buffett,
===> individual investors must Avoid Making COSTLY Mistakes that shrink their portfolio balances,
just as a football team that wants to boost their odds of winning must avoid fumbling the ball away, throwing an interception or taking a penalty at a bad time.
"Don't beat yourself
," the Oracle of Omaha says. "Beating yourself is half the problem.
USA TODAY asked Buffett to put on his personal finance hat and to tick off the three biggest mistakes amateur investors make. Here's Buffett's "Top 3 Mistakes to Avoid":
1. Trying to time the market. "People that think they can predict the short-term movement of the stock market — or listen to other people who talk about (timing the market) — they are making a big mistake," says Buffett.
2. Trying to mimic high-frequency traders. Buying stock in a good business and hanging on for the long term, he says, is a better strategy than flipping stocks like a short-order cook flips pancakes.
"If they are trading actively, they are making a big mistake
," Buffett says.3. Paying too much in fees and expenses. There's no reason to pay an expensive management fee to invest in a mutual fund when super-low-cost index funds that mimic large indexes like the Standard & Poor's 500-stock index are available, he says.
"If they are incurring large expenses in connection with their investing," says Buffett, "they are making a big mistake."
Buffett, of course, is famous for buying stocks when they are cheap, buying solid businesses that make a lot of money today and will make a lot of money tomorrow, and hanging on to his investments for a long time to better maximize profit potential.
The strategy works. You don't become the richest person in America during your career with a lousy investment game plan. (Buffett, with a net worth of $58.5 billion, is currently ranked No. 2 behind Microsoft founder Bill Gates, who's worth $72 billion, according to Forbes magazine.)"Doing reasonably well investing in stocks
," Buffett says, "is very, very easy."
Here's how he says investors should play the investing game:"Buy an index fund, preferably over time, so you end up owing good businesses at a reasonable average price,
" says Buffett. "And that is all you have to do.
"That's it? It's that simple? Buffett says yes.
"You don't need to look at the prices of the stocks you own from week-to-week, or month-to-month, or even year-to-year,
" says Buffett.
"If you own a cross-section of American businesses,
===> and you DON't Get Excited (and Buy) just at the very top,
====> and if you Buy in over time,
you are going to Do Well."
Post by me200 on Jan 12, 2014 17:38:46 GMT 7
Warren Buffett: Get the Debt Ceiling Out of the Picture
FORTUNE -- As Congress scrambles to lift the nation's borrowing limit and avoid the risks of defaulting on its debt, billionaire investor Warren Buffett joined critics of the debt ceiling, calling the 1930s law originally intended to give the government more flexibility to borrow funds "a weapon of mass destruction."
"It really is like a nuclear bomb," says Buffett on Wednesday at Fortune's annual Most Powerful Women Summit in Washington, D.C."It's something that maybe you talk about but never dream of using."
Buffett's not alone. He joins the likes of U.S. Federal Reserve Chairman Ben Bernanke who argue the debt ceiling makes no sense and wishes it didn't exist. In recent years, politicos (ahem, Republicans) have gotten in the awful habit of framing the debt ceiling as a debate over excessive government spending, when in fact, the law has nothing to do with future spending. The debt ceiling simply gives the U.S. Treasury the flexibility to borrow for spending that Congress has already approved.
Despite all the fear and political wrangling in Washington, Buffett says it's "absolutely folly" to even think the U.S. will default on its debt because "it is so stupid."
In true Buffett fashion, the Oracle of Omaha had positive views of the U.S. economy. The recovery hasn't stalled, and it's still a good time to invest.
"The country is coming back," he says. "You can't stop the United States. We get through everything. The country works."
MORE: Complete coverage of the Most Powerful Women Summit
Buffett recalled buying his first stock in April 1942 shortly after Japan's attack on Pearl Harbor that brought the U.S. into World War II. The Dow sank to 100 at the time, but he says that didn't discourage him from investing in the stock market. He has been buying stocks since.
A lesson for investors: "You want to be greedy when others are fearful ... I've got plenty of greed."
Buffett touched on several other topics, from the economic rise of China to women in corporate America. On China, he says the world's second-biggest economy will be "enormously important and they should be," but the U.S. will be "the superpower of the world for a very, very, very long time.
"What's important is that the two countries largely learn to live together," says Buffett about tensions between the U.S. and China.
Widely considered the best investor of the 20th Century, Buffett, 83, attributes part of his success to luck and timing. He built his career at a time when most women were either teachers or nurses or secretaries or housewives. "I was lucky I was only competing with half the country," he says, adding that he's focused on attracting more talented women to his firm, Berkshire Hathaway.
"Berkshire is going to prove that a lot of talented women could accomplish a whole lot."