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Few lessons to learn from Buffett

Another link from CNN Money on few lessons which every investor can learn from the Oracle of Omaha, Warren Buffett.

Enjoy the article – You can’t be Buffett, but you can try to think like him.

Here are the points discussed in the article.

• Be greedy when others are fearful – Buy when others are afraid (like now). There are plenty of good bargains around. Sell when everyone starts to talk about stock market and being greedy.
• Don’t be hobbled by past mistakes – A failing sector such as the financial sector, can prove to be a good bargain. A few mistakes now, does not mean the entire sector is “dead”.
• Don’t fall in love with your stocks – It’s good to be able to hold on to your stocks as a long term investor. But if your stocks are priced at a very good value, don’t hesitate to sell.
• Keep your powder dry – Keeping some of your cash on low return investment might not seem attractive, but it’s safe and all the cash in there might prove to be helpful when you need them the most.
• Warren can strike deals you can’t – Face it, we’re not as rich as he or his company is. Many companies such as Goldman Sachs actually gave him a very good offer just to get his “seal of approval”.
• Warren is smarter than you are - His knowledge does not lie only on stocks. He also helps his company earns by putting the money in currencies, options, etc.
• Why mimic Warren when you can hire him? - This might not be applicable to Malaysians since we do not have access to Berkshire’s stock. But if you think there are some good investment banks in Malaysia, maybe it’s a good idea to hire them by buying their stocks.

In the end, it’s quite impossible to 100% mimic Warren because you’re not him. Even if you do get 90% similarity, you might not be able to achieve the success he has achieved. Because you’re not him.

So, rather than trying to mimic him or other successful investors, maybe it’s easier to hire them or develop your own type of investing.

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