Warren Buffett Quotes On Investing

I was searching the entire web for some famous quotes said by the legendary investor Warren Buffett. I don’t know how many I’ve read. But I would like to share with you 79 of them which I find interesting and which do makes sense. If you are an investor then it’s a must read! And feel free to comment below if I’d missed something! Happy Investing!

‘Never invest in a business you cannot understand.’

‘Always invest for the long term.’

‘Buy a business, don’t rent stocks.’

‘Someone’s sitting in the shade today because someone planted a tree a long time ago.’

‘I really like my life. I’ve arranged my life so that I can do what I want.’

‘We will only do with your money what we would do with our own.’

‘If you don’t feel comfortable owning something for 10 years, then don’t own it for 10 minutes.’

‘I am a better investor because I am a businessman and a better businessman because I am an investor.’

‘Price is what you pay. Value is what you get.’

‘The Stock Market is designed to transfer money from the Active to the Patient.’

‘Stop trying to predict the direction of the stock market, the economy, interest rates, or elections.’

‘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 ten years.’

‘I don’t look to jump over 7-foot bars: I look around for 1-foot bars that I can step over.’

‘For some reason, people take their cues from price action rather than from values. What doesn’t work is when you start doing things that you don’t understand or because they worked last week for somebody else. The dumbest reason in the world to buy a stock is because it’s going up.’

‘We don’t get paid for activity, just for being right. As to how long we will wait, we’ll wait indefinitely.’

‘As Buffet said in the speech, "He’s not looking at quarterly earnings projections, he’s not looking at next year’s earnings, he’s not thinking about what day of the week it is, he doesn’t care what investment research from any place says, he’s not interested in price momentum, volume or anything. He’s simply asking: What is the business worth?’

‘Buy companies with strong histories of profitability and with a dominant business franchise.’

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

‘When asked how he became so successful in investing, Buffett answered: ‘we read hundreds and hundreds of annual reports every year.’

‘When a management team with a reputation for brilliance joins a business with poor fundamental economics, it is the reputation of the business that remains intact.’

‘Only those who will be sellers of equities in the near future should be happy at seeing stocks rise.  Prospective purchasers should much prefer sinking prices.’

‘Diversification is a protection against ignorance. It makes very little sense for those who know what they’re doing.’

‘Wide diversification is only required when investors do not understand what they are doing.’

‘You’re neither right nor wrong because other people agree with you. You’re right because your facts are right and your reasoning is right – that’s the only thing that makes you right. And if your facts and reasoning are right, you don’t have to worry about anybody else.’

‘It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.’

‘The first rule is not to lose. The second rule is not to forget the first rule.’

‘Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.’

‘I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.’

‘Why not invest your assets in the companies you really like? As Mae West said, ‘Too much of a good thing can be wonderful.’

‘Our favorite holding period is forever.’

‘Risk comes from not knowing what you’re doing.’

‘Time is the friend of the wonderful company, the enemy of the mediocre.’

‘Unless you can watch your stock holding decline by 50% without becoming panic-stricken, you should not be in the stock market.’

‘The critical investment factor is determining the intrinsic value of a business and paying a fair or bargain price.’

‘Investors making purchases in an overheated market need to recognize that it may often take an extended period for the value of even an outstanding company to catch up with the price they paid.’

‘Risk can be greatly reduced by concentrating on only a few holdings.’

‘It is not necessary to do extraordinary things to get extraordinary results.’

‘An investor should ordinarily hold a small piece of an outstanding business with the same tenacity that an owner would exhibit if he owned all of that business.’

‘Great investment opportunities come around when excellent companies are surrounded by unusual circumstances that cause the stock to be misappraised.’

‘In the business world, the rearview mirror is always clearer than the windshield.’

‘If a business does well, the stock eventually follows.’

‘Cash never makes us happy, but it’s better to have the money burning a hole in Berkshire’s pocket than resting comfortably in someone else’s.’

‘A public-opinion poll is no substitute for thought.’

‘I never buy anything unless I can fill out on a piece of paper my reasons. I may be wrong, but I would know the answer to that. "I’m paying $32 billion today for the Coca Cola Company because." If you can’t answer that question, you shouldn’t buy it. If you can answer that question, and you do it a few times, you’ll make a lot of money.’

‘The investor of today does not profit from yesterday’s growth.’

‘You only have to do a very few things right in your life so long as you don’t do too many things wrong.’

‘It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.’

‘You ought to be able to explain why you’re taking the job you’re taking, why you’re making the investment you’re making, or whatever it may be. And if it can’t stand applying pencil to paper, you’d better think it through some more. And if you can’t write an intelligent answer to those questions, don’t do it.’

‘Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it.’

‘An investor needs to do very few things right as long as he or she avoids big mistakes.’

‘Do a lot of reading’ (On how to determine the value of a business)

‘The investor of today does not profit from yesterday’s growth.’

‘Only when the tide goes out do you discover who’s been swimming naked.’

‘The fact that people will be full of greed, fear, or folly is predictable. The sequence is not predictable.’

‘You do things when the opportunities come along. I’ve had periods in my life when I’ve had a bundle of ideas come along, and I’ve had long dry spells. If I get an idea next week, I’ll do something. If not, I won’t do a damn thing.’

‘Time is the friend of the wonderful company, the enemy of the mediocre.’

‘I do not like debt and do not like to invest in companies that have too much debt, particularly long-term debt. With long-term debt, increases in interest rates can drastically affect company profits and make future cash flows less predictable.’

‘We will reject interesting opportunities rather than over-leverage our balance sheet.’

‘I always knew I was going to be rich. I don’t think I ever doubted it for a minute.’

‘Turnarounds seldom turn.’

‘If at first you do succeed, quit trying on investing.’

‘I don’t measure my life by the money I’ve made. Other people might, but certainly don’t.’

‘Anything can happen in stock markets and you ought to conduct your affairs so that if the most extraordinary events happen, that you’re still around to play the next day.’

‘You shouldn’t own common stocks if a 50 per cent decrease in their value in a short period of time would cause you acute distress.’

‘With few exceptions when a manager with a reputation for brilliance tackles a business with a reputation for poor economics, it is the reputation of the business which remains intact.’

‘The business schools reward complex behavior more than simple behavior, but simple behavior is more effective.’

‘It’s not debt per say that overwhelms an individual corporation or country. Rather it is a continuous increase in debt in relation to income that causes trouble.’

‘A great investment opportunity occurs when a marvelous business encounters a one-time huge, but solvable problem.’

‘You do not adequately protect yourself by being half awake when other are sleeping.’

‘We like to buy businesses, but we don’t like to sell them.’

‘Money to some extent sometimes let you be in more interesting environments. But it can’t change how many people love you or how healthy you are.’

‘It’s us fun being a gorse when the tractor comes along, or the blacksmith when the car comes along.’

‘Enjoy your work and work for whom you admire.’

‘With enough insider information and a million dollars, you can go broke in a year.’

‘Read Ben Graham and Phil Fisher read annual reports, but don’t do equations with Greek letters in them.’

‘In a commodity business, it’s very hard to be smarter than your dumbest competitor.’

‘A hyperactive stock market is the pickpocket of enterprise.’

‘Valuing a business is part art and part science.’

‘Chains of habits are too light to be felt until they are too heavy to be broken.’

As you probably know almost all global markets (especially the emerging markets) are correcting and all of them have corrected sharply. It doesn’t matter whether you are from India or China or USA, the recent fall in stocks would have affected you.

I’m sure that you must be in a panic situation now even I’m in a panic situation. So that made me to write this blog post. I started investing in Stock Market back in 2005. But I didn’t make any significant amount of returns. In fact I have booked losses several times in range of 5 to 20% and then quit the stock market for some time. But I decided to enter stocks again back in January and started building a portfolio. I started with Mutual Funds too but when the markets fell sharply. I asked myself "Why should I invest in Mutual Funds when the Stock Market is attractive?" that made me to invest directly in stocks. And I began to buy quality stocks on every dip. The result: the stock market crash never ended it and it’s falling day by day. And I’m sitting at a loss of 10%.

But should I sell and book the losses and get out of the market? I entered the market with a long term perspective and that made me to stay in the market.

When I first started investing in stock I was a short term player. Whenever a stock in my portfolio moves up 5 to 10% I book my profits and some of them even jumped 50% in less than a month, I booked my profits. While some of them dropped 10 to 20% and I booked my losses and got out from the markets. I lost more money than I gained from the market. That made me to quit stock market. But I used to watch the stocks whenever I get time but didn’t invested in stocks for a long time, not because they dropped 20% or I booked my losses. It’s because the same stocks began to move up very sharply with the market in less than a month the stocks which I sold off were up by over 20% my acquired price. And in six months some of them shot up by 100% and some by 500% and some by 1000%. And I learned a great lesson!

Now, many of you might have actually lost their patience and sleep. The situation is even worse for me and others who entered the stock market in the past two months. Your losses could be anywhere between 10% to 50%.

But now I am not that panic or I have decided not to panic will continue to hold all my quality stocks.

1. Stop Listening To Stock Market Analysts

Almost all stock market analysts in the media confuse you instead of giving a solution. Some will say the market will move up from next month onwards and some will say we are in a bear market and so on. So stop listening to them as you wont get any relief from their words. Have faith in yourself! Peace and hope are all within you. It doesn’t mean to buy a stupid company and hold that for long. I suggest you to study the market thoroughly and do your home work and analysis. Pick stocks which are fundamentally strong and if some analysts are recommending the same stock then consider that as a plus point. Don’t buy stocks only because of someone’s recommendation.

2. Don’t Look At Your Portfolio Every Single Minute

Another big mistake investors make is that they used to track their portfolio every single minute and seconds. A fall makes then feel worse and a slight rise in stock prices makes them feel better or happy. But this should be discontinued. How about tracking the fundamentals of the company when they announce their quarterly results? If your company is growing – then be happy. If they are reporting losses continuously then exit from that stock. Sooner or later the prices of your shares will settle around its fundamental value. And please stop following rumors about fundamentally strong companies.

Suppose you hold a Fixed Deposit (or Certificate of Deposit) with a bank then would you look at its value daily? Absolutely no, use that same principle when you invest in stock market.

3. Be Patient

It’s very common that you invest all your money at once instead of investing the same in a systematic manner. So chances are that you running out of cash when the stock market corrects sharply. But even then be patient and continue to hold your stocks.

4. Speak To Actual Investors Who Have Experience

Instead of interacting with analysts or stock brokers, speak with real investors who have been in the market for long time and ask about how they have survived in the market and how they have created their wealth.

 5. Stop Following Crazy Tips By Others

Stop following Hot tips which promise you to make you a millionaire in months. Yes it could really be a hot tip for Billionaires who would end up as millionaires in case they do follow the tip.

6. Understand The Market Cycles

Every and every asset class has a cycle whether its Stock Market or Real Estate or Gold or Silver all move in cycles. Realize the fact that no asset class will go only in one direction. If you go back to its history then you can see several instances when stocks prices have actually moved up and down. But over the longer period of time every asset class will reward its investors.

Stock markets, mutual funds, real estate all move in cycles. Please realize that nothing can keep going up forever in a single direction. There will be phases when prices will come down and again move up. If you go back into history you will see several instances when stock prices came down, however over a period of time quality companies always reward investors. Understand market cycles, and don’t become a slave to them.

7. Follow The ‘Guru’

Warren Buffett is an American investor, businessperson and philanthropist. He is the richest person in the world according to Forbes Magazine with an estimated current net worth of around US$62 Billion. He known as the world’s greatest investor or “Oracle of Omaha”. If you are an investor then the Wikipedia article of Warren Buffett is a must read.

He simply invested in quality stocks which have some value for longer term. He invested in Gillette, for the simple reason that he believed that men won’t stop shaving. So it makes sense to follow him. He entered the stock market when he was just eleven. He bought three shares of Cities Service at $38 per share, and shortly after buying the stock it fell to $27 per share. But he held his shares and sold for $40 per share when it was rebounded. But he regretted for that as the Cities Services shares shot up to $200. So that taught him one of the basic lessons of investing "patience is a virtue".

Happy Investing!

Microsoft Reports 27% Revenue Growth; Fastest First Quarter Since 1999

REDMOND, Wash. — October 25, 2007 — Microsoft Corp. today announced revenue of $13.76 billion for the quarter ended September 30, 2007, a 27% increase over the same period of the prior year. Operating income, net income and diluted earnings per share for the quarter were $5.92 billion, $4.29 billion and $0.45, respectively.

“This fiscal year is off to an outstanding start with the fastest revenue growth of any first quarter since 1999,” said Chris Liddell, chief financial officer at Microsoft. “Operating income growth of over 30% also reflects our ability to translate revenue into profits while making strategic investments for the future.”

Microsoft profit rises on PC demand

Microsoft posted a rise in quarterly profit on Thursday, boosted by healthy demand for personal computers loaded with its Windows operating system and strong sales of its “Halo 3″ video game.

The world’s largest software maker said net profit in its fiscal first quarter totaled $4.29 billion, or 45 cents per diluted share, versus $3.48 billion, or 35 cents per diluted share, a year earlier.

Revenue rose 27 percent to $13.76 billion in the three months ended September 30.

Analysts, on average, had forecast 39 cents per share in first-quarter profit on revenue of $12.54 billion, according to Reuters Estimates.

Market research firms Gartner and IDC said global PC shipments rose about 15 percent in the September quarter, which helped Microsoft as well as the quarterly results of chip maker Intel.

Microsoft also enjoyed strong sales of “Halo 3,” the latest installment of its flagship shooter franchise. The blockbuster game title racked up more than $300 million in its first week of sales after its September 25 debut. Consumers also purchased the Xbox 360 console to play the game, vaulting the game machine past rival consoles in September.

For the current quarter, Microsoft forecast earnings in a range of 44 cents to 46 cents per diluted share on revenue of $15.6 billion to $16.1 billion.

Analysts, on average, were forecasting earnings per share of 44 cents a share on revenue of $15.5 billion in Microsoft’s fiscal second quarter, according to Reuters Estimates.

The holiday quarter is a crucial one for Microsoft as it aims to spur adoption of new computers running its latest Windows Vista operating system. Its entertainment arm also counts on the December quarter generating twice as much revenue as any other quarter of the year.

Microsoft also raised full-year earnings estimates to a range of $1.78 to $1.81 per share from a previous range of $1.69 to $1.73. It also raised its full-year revenue estimate range by almost $2 billion, to $58.8 billion to $59.7 billion.

Wall Street analysts, on average, were forecasting fiscal 2008 earnings of $1.73 per share on revenue of $57.3 billion.

As of the close of Wednesday trade, Microsoft shares had fallen about 1 percent since it reported quarterly results in July compared with 2 percent declines for both the S&P 500 and Nasdaq.

Source: Reuters