CONITNUED FROM YESTARDAY......
How can the average investor employ Warren Buffett’s methods?
Love everything :-
Warren Buffett is, first of all, very content. He loves everything
he does, dealing with people and reading mass quantities of annual and
quarterly reports and numerous newspapers and periodicals. As an investor
he has discipline, patience, flexibility, courage, confidence, and
decisiveness. He is always searching for investments where risk is
eliminated or minimized. In addition, he is very adept at probability
and as an odds maker. I believe this ability comes from an inherent love
of simple math computations, his devotion and active participation in
the game of bridge, and his long experience in underwriting and accepting
high levels of risk in insurance and in reinsurance. He is willing
to take risks where the odds of total loss are low and upside
rewards are substantial. He lists his failures and mistakes and does not
apologize. He enjoys kidding himself and compliments his associates in
objective terms.
Become wonderful listener :-
Warren Buffett is a great student of business and a wonderful listener,
and able to determine the key elements of a company or a complex
issue with high speed and precision. He can make a decision not to
invest in something in as little as two minutes and conclude that it is
time to make a major purchase in just a few days of research. He is always
prepared, for as he has said in an annual report, “Noah did not start
building the Ark when it was raining.”
willingness to learn:-
Two examples of Warren Buffett’s willingness to learn and adapt
himself are:-
1) public speaking
In the 1950s Warren invested $100 in a Dale Carnegie course “not to prevent my knees from knocking when public speaking but to do public speaking while my
knees are knocking.”
2) computer usage
To be able to play more bridge, early in 1994 Warren learned how to use a computer so he could join a network where you can play with other individuals from their locations
all over the country. Perhaps in the near future he will begin to use some of the hundreds of data retrieval and information services on companies that are available on computers today for investment research.
Do not care stock market :-
Warren Buffett stresses that the critical investment factor is determining
the intrinsic value of a business and paying a fair or bargain price. He doesn’t care what the general stock market has done recently or will do in the future. He purchased over $1 billion of Coca-Cola in 1988 and 1989 after the stock had risen over five fold the prior six years and over five-hundredfold the previous sixty years. He made four times
his money in three years and plans to make a lot more the next five, ten, and twenty years with Coke. In 1976 he purchased a very major position in GEICO when the stock had declined from $61 to $2 and the general perception was that the stock was definitely going to zero.
Identify “Circle of Competence” :-
How can the average investor employ Warren Buffett’s methods?
Warren Buffett never invests in businesses he cannot understand or that
are outside his “Circle of Competence.” All investors can, over time,
obtain and intensify their “Circle of Competence” in an industry where
they are professionally involved or in some sector of business they enjoy
researching. One does not have to be correct very many times in a lifetime
as Warren states that twelve investments decisions in his forty year
career have made all the difference.
TO BE CONTINUED TOMORROW.......
what are weakness and strength you find while reading this article/section ?
please give your comment below (in comment label) as how can this article/section be improved further ? it will GIVE THE OPPORTUNITY TO MEMBERS OF “ jab we met CA “ BLOG TO IMPROVE THEMSELVES. WAITING FOR YOUR REPLY....
SATBIR SINGH
PRESIDENT
JAB WE MET CA
REDEFINING PROFESSIONALISM......
“ENJOY TODAY ,WAIT FOR BEAUTIFUL TOMORROW ”
No comments:
Post a Comment