Tag: Value Investing

Conventional wisdom suggests investors should aim to buy low and sell high—ideally at a stock’s peak. But Warren Buffett takes a different view.

At the 1998 Berkshire Hathaway Annual Meeting, Buffett explained that he’s unbothered when stocks he’s sold go on to climb higher. In fact, he sees it as a positive sign.

“I would worry, frankly, if I sold a bunch of things right at the top,” he said. “That would indicate that I was practicing the bigger fool-type approach to investing, and I don’t think that can be practiced successfully over time.”

Instead, Buffett believes selling a stock that later rises even more is often a sign that you’ve invested in strong businesses—exactly what a long-term investor should aim to do.

Hear Buffett’s full explanation

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© 2025 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

In the world of investing, it’s easy to get swept up in the excitement of hot sectors or trendy companies. But Warren Buffett reminds investors to stay focused on fundamentals: it’s not about where the money comes from—it’s about how much of it a business can generate over time.

“Whether the money comes from a bank, whether it comes from an internet company, or whether it comes from a brick company, the money all spends the same,” Buffett said at the 2002 Berkshire Hathaway Annual Meeting. What matters, he emphasized, are the economic characteristics that determine how much long-term cash a business can produce.

In other words, don’t chase trends. Focus on businesses with strong fundamentals and predictable cash flows—regardless of how fashionable they seem.

Hear Buffett’s full explanation

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© 2025 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

“Where Are Markets Headed? Six Pros Take Their Best Guess,” read a headline in The Wall Street Journal—a familiar question in the world of investing. From financial news shows to market commentaries, speculation about whether stocks are peaking or bottoming is constant. But Warren Buffett has long warned against trying to time the market.

“I know of no one that has been successful at, and really made a lot of money, predicting the actions of the market itself,” Buffett said at the 1999 Berkshire Hathaway annual meeting. “I know a lot of people who have done well picking businesses and buying them at sensible prices.”

Buffett’s message is clear: real investment success comes not from guessing market moves, but from identifying strong businesses and buying them at good value. While market predictions may grab headlines, long-term discipline and business-focused investing remain the timeless strategy.

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2025 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

When it comes to investing, Warren Buffett doesn’t believe in guesswork—especially when it comes to financial statements. At the 1995 Berkshire Hathaway Annual Meeting, Buffett cautioned investors against putting money into companies with confusing or unclear accounting.

“I would say that when the accounting confuses you, I would just tend to forget about it as a company,” he said. “We have never had any great investment results from companies whose accounting we regarded as suspect. I can’t think of a one. It’s a very bad sign.”

Buffett’s message is simple: if a company’s financials aren’t transparent, it’s not worth the risk.

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2025 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

At the 1999 Berkshire Hathaway Annual Meeting, Warren Buffett offered a simple yet powerful definition of investing—and a clear distinction from gambling.

“Investment is the process of putting out money today to get more money back at some point in the future,” he explained. “And the question is, how far in the future, how much money, and what is the appropriate discount rate to take it back to the present day and determine how much you pay?”

Unlike gambling, which relies on chance and short-term outcomes, investing involves evaluating the value of future returns and making informed decisions based on long-term expectations. For Buffett, successful investing means thinking carefully about time, value, and risk—never simply making a bet.

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series
At the 1999 Berkshire Hathaway Annual Meeting, Warren Buffett offered a simple yet powerful definition of investing—and a clear distinction from gambling.

“Investment is the process of putting out money today to get more money back at some point in the future,” he explained. “And the question is, how far in the future, how much money, and what is the appropriate discount rate to take it back to the present day and determine how much you pay?”

Unlike gambling, which relies on chance and short-term outcomes, investing involves evaluating the value of future returns and making informed decisions based on long-term expectations. For Buffett, successful investing means thinking carefully about time, value, and risk—never simply making a bet.
© 2025 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Warren Buffett has long emphasized that investing is more than just trading shares—it’s about owning a piece of a real business. At the 2013 Berkshire Hathaway Annual Meeting, Buffett reiterated this core philosophy, saying, “It’s very important to have that mindset that we are buying businesses, whether we’re buying 100 shares of something or whether we’re buying the entire company. We always think of them as businesses.”

For Buffett, every investment is an opportunity to partner in a company’s long-term success, not just a bet on short-term price movements. This disciplined, business-first approach has guided his investing decisions for decades.

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2025 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Warren Buffett has long stressed the importance of independent research in investing. While markets are filled with opinions, forecasts, and hype, Buffett warns that relying too heavily on others can be costly.

“The key to investing is not how much you know,” Buffett has noted, “but how realistically you define what you don’t know.” His approach underscores the value of careful research, analysis, discipline, and sticking to businesses you understand.

That same discipline guided him into major investments in Japan. At the 2025 Berkshire Hathaway Annual Meeting, Buffett recalled starting with a handbook—filled with listing companies two to a page. “It’s amazing what you can find when you just turn the page,” he said. “Turning every page is one important ingredient to bring to the investment field. Very few people do it—and those who do aren’t going to tell you what they’re finding.”

By doing your own research, Buffett argues, you avoid being swept up in speculation and gain the confidence to hold investments through volatility. In his view, sound decisions come not from chasing trends but from clear-eyed judgment about a company’s ability to generate long-term value.

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2025 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

While plagiarism is a surefire way to land in trouble in creative fields like songwriting, Warren Buffett believes copying can be a smart strategy in the world of investing—provided you understand what you’re borrowing.

Speaking at the 1995 Berkshire Hathaway Annual Meeting, Buffett emphasized the value of learning from others: “If you learn reasonably well from other people, you don’t have to get any new ideas or do much on your own. You can just apply the best of what you see.”

Buffett himself credits much of his investment philosophy to the insights of Benjamin Graham’s The Intelligent Investor and Philip Fisher’s Common Stocks and Uncommon Profits. For Buffett, success isn’t about reinventing the wheel—it’s about recognizing wisdom and applying it effectively.

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2025 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

One of the most formative books Warren Buffett read as a young investor was The Intelligent Investor by Benjamin Graham. Buffett has praised it as “by far the best book on investing ever written.”

A key concept from the book is the character of “Mr. Market,” Graham’s metaphor for the stock market’s often irrational behavior. Sometimes, Mr. Market offers fair prices for stocks—but other times, his emotions swing wildly, quoting values that are “a little short of silly.”

Buffett echoed this idea at Berkshire Hathaway’s 2012 Annual Meeting, saying, “It’s a marvelous game. The rules are stacked in your favor, if you don’t turn those rules upside down and start behaving like the drunken psychotic instead of the guy that’s there to take advantage of it.”

For Buffett, the lesson is clear: success in investing often comes down to staying rational while others are ruled by fear or greed.

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2025 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Warren Buffett is a firm believer that successful investing doesn’t require predicting the stock market’s next move. In fact, he openly admits he has no idea what the market will do in the short term. “We haven’t the faintest idea what the stock market is going to do when it opens on Monday,” he once said.

Speaking at Berkshire Hathaway’s 2022 Annual Meeting, Buffett reflected on how he missed opportunities during the COVID-19 market crash in March 2020. “We have not been good at timing,” he acknowledged. “We’ve been reasonably good at figuring out when we were getting enough for our money.”

For Buffett, the key isn’t timing—it’s value. He focuses on buying stocks when they’re undervalued and holding them for the long term. “That’s stuff you can learn in fourth grade,” he said. “But it’s not what’s taught in school.”

His approach is simple but powerful: don’t try to guess the market. Instead, look for businesses you understand, assess their true worth, and buy when the price is right.

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2025 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.