Quotes From Warren Buffett On Stock Market Investing

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Quotes From Warren Buffett On Stock Market Investing

Quotes From Warren Buffett On Stock Market Investing

Warren Buffett has shared many insights over the years into what it takes to become a successful investor. Today we are going to share some of those quotes and words of wisdom.

  • “When Berkshire buys common stock, we approach the transaction as if we were buying into a private business.”
  • “Accounting consequences do not influence our operating or capital-allocation decisions. When acquisition costs are similar, we much prefer to purchase $2 of earnings that are not reportable by us under standard accounting principles than to purchase $1 of earnings that are reportable.”

Buffett offers insights on Management and Compensation

  • “The .350 hitter expects, and also deserves, a big payoff for his performance—even if he plays for a cellar-dwelling team. And a .150 hitter should get no reward—even if he plays for a pennant winner.”
  • “Many stock options in the corporate world have worked in exactly that fashion: they have gained in value simply because management retained earnings, not because it did well with the capital in its hands.”
  • “We do not view the company itself as the ultimate owner of our business assets but instead view the company as a conduit through which our shareholders own assets.”

Insight into Buffett’s successful investing mindset

  • “You are neither right nor wrong because the crowd disagrees with you. You are right because your data and reasoning are right.”
  • “Do not take yearly results too seriously. Instead, focus on four or five-year averages.”
  • “Focus on return on equity, not earnings per share.”
  • “Turnarounds seldom turn.”

 

Buffett on assessing the success of a company & it’s stock Performance

  • “Look for companies with high-profit margins.”
  • “Is management rational?”
  • “Is management candid with the shareholders?”
  • “Does management resist the institutional imperative?”
  • “Does the business have favourable long-term prospects?”
  • “Does the business have a consistent operating history?

Buffett on Identifying  New Investment Opportunities

He states investors should look for something they have in common with the company in question and that it is better to invest in fewer companies as opposed to buying a plethora of stock in different companies.   He also feels that one should buy a stock with the intention of holding it for the long term, forever if possible

  • “Never invest in a business you cannot understand.”
  • “Unless you can watch your stock holding decline by 50% without becoming panic-stricken, you should not be in the stock market.”
  • “Why not invest your assets in the companies you really like? As Mae West said, ‘Too much of a good thing can be wonderful’.”
  • “Risk can be greatly reduced by concentrating on only a few holdings.”
  • “It is optimism that is the enemy of the rational buyer.”

Other sage words from Buffett

  • “The ability to say ‘no’ is a tremendous advantage for an investor.”
  • “It is more important to say ‘no’ to an opportunity than to say ‘yes.’”
  • “Always invest for the long term.”
  • “It is not necessary to do extraordinary things to get extraordinary results.”
  • “Stop trying to predict the direction of the stock market, the economy, interest rates, or elections.”
  • “Be fearful when others are greedy and greedy only when others are fearful.”
  • “Much success can be attributed to inactivity. Most investors cannot resist the temptation to constantly buy and sell.”
  • “Lethargy, bordering on sloth should remain the cornerstone of an investment style.”
  • “An investor should act as though he had a lifetime decision card with just twenty punches on it.”
  • “Buy a business, don’t rent stocks.”
  • “An investor should ordinarily hold a small piece of an outstanding business with the same tenacity that an owner would exhibit if he owned all of that business.”

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