Warren Buffett’s advise at the beginning of 2018. All must read.

January 2, 18

Warren Buffett’s advise at the beginning of 2018. All must read.

Greetings from Hitesh! Let us all listen to Buffett today. Over the years, I have collected some of his quick learning and they are worth taking a note before we got to the market in 2018.

BUFFETT ON INDIA:-

If Buffett was investing in India, He would have said following at this moment:-

Buffett has said following statements for USA during his various speeches. I am seeing the same thing for India at this juncture.

1)  We went from a WOODED land to an incredible, absolute abundance of riches because the United States has had a system that can unleash human potential. Never bet against what humans can accomplish if they are operating in the right soil. And we have the right soil.

(India is also moving towards implementing new system and it will surely give good results over a period of time).

2)  The American economy is going to do fine. But it will not do fine every year and every week and every month. I mean if you don’t believe that, forget about buying stock anyway. But it stands to reason. I mean we get more productive every year, you know. It’s a positive sum game, long term. And the only way an investor can get killed is by high fees and by trying to outsmart the market.

(Indian economy will also perform better over a period of time. Coming 2 years is a time for the real investors to buy and smart traders to make tons of money).           

3)  There are 309 million people out there that are trying to improve their life and we have got the system that allows them to do it.

(We have 1300 million people in India. All want to grow. So, we can grow at least 4 times than the USA, provided proper policies are followed. I am sure the government will also improve its attitude).

4)  I am huge bull on this country. WE will not have a double dip recession at all. I see our business coming back almost across the board.

Buffett on Investments:-

1)  I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years.

2)  Unless you can watch your stock holding decline by 50% without becoming panic stricken, you should not invest in the stock market.

(Above two are the most important qualities, which BUFFETT has and if you don’t have and still you talk about LONG TERM – you will lose your last shirt also. So be honest with yourself when you INVEST).

3)  A great investment opportunity occurs when a marvelous business encounters a one time huge but solvable problem.

4)  The stock market is non-called strike game. You don’t have to swing at everything – you can wait for your pitch. The problem comes when you are managing money and your fans keep on yelling “Swing Your Bum”.

5)  Five years from Now, 10 years from Now, the world everywhere will be doing better.

6)  Most people get interested in stocks when everyone is. The time to get interested is when no one else is. You can’t buy what is popular and do well.

Buffett On Relationships:-

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

2)  When investing Pessimism is your friend and    Euphoria the enemy.

Buffett on Investment Mistakes:-

1)  Borrowed money is the most common way that smart guys go broke.

2)  I have seen more people fail because of liquor and leverage – leverage being borrowed money. Your really don’t need leverage in the world much. If you are smart, you are going to make a lot of money without borrowing.

3)  Diversification may preserve wealth but concentration builds the wealth.

4)  There seems to be some perverse human characteristics that like to make easy things difficult.  

5)  It’s simply to say that managers and investors alike most understand that accounting numbers are the beginning and not the end of business valuations.

Buffett on MACROECONOMY / CROWD following and Thinking:-

1)  If we find a company we like, the level of the market will not really impact out business decisions. We will decide company by company. We spend essentially no time thinking about macroeconomic factors. In other worlds, if somebody handed us a predication by the most revered intellectuals on the subject, with the figures for unemployment, interest rates, inflation or whatever it may be fore next 2 years, we would not pay any attention to it. We simply try to focus on businesses that we thing we understand and where we like the price and management. If we see anything that relates to what’s going to happen in congress, we don’t even read it. We just don’t think it’s helpful to have a view on that matters.

2)  You are neither right not wrong because the crowd disagrees with you. You are right because your data and reasoning are right.

3)  I insist on a lot of time being spent almost everyday to just sit and think. That is very uncommon in American business. I read and think.  So, I do more reading and thinking, and make less impulsive decisions than most people in business. I do it because I like this kind of life.

BUFFETT on PATIENCE:-

1)  No matter how great talent or efforts are some things just take time. You can’t produce a baby in one month by getting nine women pregnant.

BUFFETT on BUBBLE:-

1)  A pin lies in wait for every bubble. And when they two meet, a new wave of investors learns some very old lessons.

Buffett on Investment Success:-

1)  Intensity is the price of EXCELLENCE.

What NEXT?

If you have no time to read about BUFFETT, these are some of his thoughts, which, if you follow, will surely help you improve your investment performance and quality of life.

We have developed a system from BUFFETT’s principles and we recommend all our clients to follow them.

Have a GREAT YEAR AHEAD.

Follow me on Twitter @hiteshmparikh or on WhatsApp – +91-9869425399.

Live With Passion…Invest With Passion. 

Hitesh Parikh.