Lessons From Warren Buffett

Lessons From Warren Buffett: Only Buy What You Understand

If a sector you know nothing about is booming, should you still buy it? Not if you are Warren Buffett.

“We will never buy anything we don’t think we understand,” Buffett said at the 2000 Berkshire Hathaway annual meeting. “And our definition of understanding is thinking that we have a reasonable probability of being able to assess where the business will be in 10 years.”

Hear Buffett’s full explanation

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© 2023 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.