Page content

5 Quotes From Warren Buffett: the Oracle of Omaha

5 Quotes From Warren Buffett: the Oracle of Omaha

If I had to pick my favourite investor of all-time, it would be Warren Buffett. At the time of writing Warren is 85 years old, has a net worth of $70 Billion and is still passionately active as CEO of Berkshire Hathaway. Warren Buffett serves as an inspiration for many investors and managers in business. Buffett is friendly, energetic and, most importantly, really knowledgeable in the field of investing.

Warren Buffet Quote #1

THE MOST IMPORTANT INVESTMENT YOU CAN MAKE IS IN YOURSELF

One of the things that made Warren Buffett such a successful investor (and makes anyone successful, for that matter) is his never-ending investment in himself. He says that he reads 250 – 1000 pages a day! From self-help books such as

 

How To Win Friends and Influence People

How to win friends and influence people

And investing-related books such as:

Intelligent Investor

The Intelligent Investor

 

If you ever wished that Warren Buffett would give you investment advice, here you have it: invest in yourself before anything else!

 

Warren Buffet quote #2

It is better to hang out with people better than you. Pick out associates whose behaviour is better than yours and you will drift in that direction.

Print this on your forehead if you want to become better at anything in life; not just investing. Surround yourself with people from whom you can learn and who motivate you, they will bring you a lot further in life. If you surround yourself with unambitious friends, that’s fine, but you’ll tend to drift into that direction as well.

Forbes magazine cover: trillion dollar pictures

If you’re the smartest person in the room, you’re in the wrong room

 

Warren Buffet quote #3

Rule No. 1: Never lose money. Rule No. 2: Never forget rule No.1

If you want to make money in the stock market, make sure you never lose money! This is easier said than done, even Warren has lost money in the stock market. However, many investors should be reminded of this quote more often. Read this quote every time you make an investment and ask yourself the following:

  • Am I really sure that I’m making the right investment?
  • Am I not speculating?
  • Did I do the best research I could possibly do?
  • Am I making this investment because it will earn me more money than anything else I could have invested in, or just because I think it is exciting?

If you’re not fully confident that you are making the right investment, put your money into something less risky like the S&P 500, for example – or keep looking for better investments if you’re an active investor. Remember, never lose money..

 

Warren Buffet Quote #4

Risk comes from not knowing what you are doing

If only more people realized this, their lives (and the economy) would be so much better. Do you know why so many people lose money in the stock market? Because – quite frankly –  they have no clue what they’re doing. They think they know, but they don’t.

Dunning-Kruger graph

The Dunning-Kruger graph shows how people with the least amount of skill/experience are most confident in their own abilities, whereas people who know increasingly more see a drop in their confidence.

Overconfidence is one of the pitfalls for investors; this has been proven by scientific research. The human mind is quite irrational and leads us to make strange decisions. This is exactly the reason why I advise so many beginning investors to invest in an ETF or an Index Fund.

As a beginning investor you simply don’t have the ability to make investments in individual stocks! Even professionals struggle with it a great deal and often can’t outperform ETFs. To overcome this pitfall, inform yourself to the best of your ability. Read financial statements, read books on investing, gather all the facts you possibly can.

Knowing the facts and knowing what you’re doing minimizes the risk.

 

Warren Buffett Quote #5

Be Fearful When Others Are Greedy and Greedy When Others Are Fearful

It’s hard to be greedy when others are fearful, since it goes straight against your instinct (which tells you to run away as hard as you can). However, being greedy when everything in the market seems to fall apart could make you some serious gains. Don’t be one of those investors that invests heavily when the stock market seems like heaven on earth; we have way too many people like that already.

buy high, sell low

This is the recipe for disaster. Buying high and selling low is their motto.. Good luck making money with that strategy.

 

And that Concludes the List!

To round it off, here is a short video of buffett talking about his recommended investing strategies for the average investor.

I didn’t talk too much about his personal life but if it interests you, I recommend you to read

Buffett: The Making of an American Capitalist or The Snowball: Warren Buffett and the Business of Life

Both are great books that cover his personal as well as professional life. Very inspiring!

Comment Section

0 thoughts on “5 Quotes From Warren Buffett: the Oracle of Omaha

Leave a Reply


*


like

Insert value investing wisdom into your timeline