Warren Buffett Book of Investing Wisdom: 350 Quotes from the World's Most Successful Investor

These easy to digest quotes from Warren Buffett capture the essence of his approach to life, investing, success, leadership, emotion and money. Buffett’s fortune has grown 7.2% in 2022 to $116.7 billion as shares of Berkshire Hathaway Inc. had rallied, putting him in fifth place on the Bloomberg Billionaires Index. As CEO of Berkshire Hathaway, Warren Buffett lives by a certain set of values that he uses on a daily basis.

His approach to investing in stocks can be identified throughout his famous investing quotes. From there, we can have a look into the mind of one of the wealthiest and most successful people in the world.

Opportunities

Enjoy the discount when the market plummets from time to time
Big opportunities come infrequently. When it is raining gold, reach for the bucket, not a thimble
Celebrate the stock market discount
Cash combined with courage in a time of crisis is priceless
Equities will do well overtime, you just have to avoid getting excited when other people are getting excited
You want to buy when a great company gets into temporary troubles
In investing, you just have to wait for the next pitch
You don’t have to swing at everything in the stock market. You can wait for your pitch
A climate of fear is your best friend. When you invest when the market is upbeat, you end up paying a heavy price for meaningless reassurance
Rationality is important for investor. 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
Great investment opportunities come when excellent companies are surrounded by unusual circumstances that cause the stock to be misappropriated

Time in the market

Someone is sitting in the shade today because someone planted a tree long time ago
We don’t get paid for activity, just for being right
Don’t time the purchases
Anything can happen in the market. No one knows when chaos will occur, market forecasters will fill your ear
Don’t try to figure out what the market is doing. Figure out a business you understand and concentrate
Stop trying to predict the direction of the stock market, economy, interest rates or elections
Investors making purchases in an overheated market need to recognise that it many take an extended period for the value of even an outstanding company to catch up with the price they paid

As to how long we will wait, we will wait indefinitely

Knowledge

You’d want to know all about what you buy in the stock market
Never invest in a company you can’t understand
Risk comes from not knowing what you are doing
Most men would rather die than think, many do
When a pin meets a bubble, new wave of investors learns some very old lessons
A lot of time daily should be spent sitting, reading and thinking. Also to make less impulse decisions
Successful investing takes time, discipline and action
A public opinion poll is no substitute for thought
The market helps those who helps themselves. But the market does not forgive those who know not what they do
Have a plan to allocate capital
Write down the reason you are buying the stock before your purchase. It clarifies your mind and discipline

Stock picking

Find businesses on the basis of value, good management and limited exposure to hard times
Buy shares in great business for less than its intrinsic value with managers of the highest integrity and ability
It takes 20 years to build a reputation and 5 mins to ruin it
As an Investor, purchase easily understandable business who earnings will be materially higher ten years on at a rational price.
Ideal business to buy: something that costs a penny, sells for a dollar and is habit forming
A truly great business must have an enduring moat
Check if you can sensibly estimate an earnings range for five years or more before you buy the stock
The worse business grow rapidly, requires significant capital to engender the growth and then earn little or no money
Don’t buy a stock because of price action. The dumbest reason in the world is to buy a stock because it is going up

Unless you can watch your stock holding decline by 50% without being panic stricken, you should not invest in the stock market
The worse business grow rapidly, requires significant capital to engender the growth and then earn little or no money
Determine the competitive advantage and durability of it for any given company. If they have pricing power, it is good
If you invest in a vulnerable business, you need a larger margin of safety
Are you investing in a company because you want to own it or because you want the stock to go up

Determine the competitive advantage and durability of it for any given company. If they have pricing power, it is good
Better to buy a wonderful company at a fair price, than a fair company at a wonderful price

Investing Wisdom

A bull market is like sex. It feels best just before it ends
The market helps those who helps themselves. But the market does not forgive those who know not what they do
Derivatives are financial weapons of mass destruction
Sound investing can make you very wealthy if you are not in a hurry
Have a plan to allocate capital
Invest in an index fund over 10 years
Investment rewards come to those who by good luck or good sense, find the occasional company that over the years can grow in sales and profits far more than the industry as a whole
In investing, you just have to wait for the next pitch
Profit from the folly of the market fluctuations than participate in it
Never lose money
Right thinking duck will compare its position after a downpour to that of other ducks in the pond
Put meaningful amount of money in a few things
Investing is picking good stocks at good times and staying with them as long as they remain good companies
Few should try to be an active investor. Buy an index fund overtime
Be fearful when others are greedy, be greedy when others are fearful
Price is what you pay, quality is what you get
Losing money is an inevitable part of investing and there is nothing you can do to prevent it
Nothing sedates rationality like large doses of effortless money

"I like to buy quality merchandise when it is marked down"

Pessimism is your friend. Euphoria is your enemy in investing
Investor can get killed by the high fees or trying to outsmart the market
The ability to say no is a tremendous advantage for an investor
Much success can be attributed to inactivity. Most investors cannot resist the temptation to constantly buy and sell
Optimism is the enemy of a rational buyer
Ordinary intelligence and overcoming the urges that get other people in trouble for investing will do
Consider 4 or 5 year averages instead of yearly results
Political and economic forecasts are an expensive distraction
A prediction about the direction of the stock only tells you about the person doing the predicting
Investors on overage and overtime will do better with a Low cost index fund than a group of funds
Keep all your eggs in one basket but watch that basket closely
Rational behaviour = proper temperament + proper intellectual framework
It is not necessary to do extraordinary things to get extraordinary results
When mr market is enthused, you sell to him. When mr market is depressed, you buy for him. When there is nothing to do, do nothing

For investors as a whole, returns decrease as motion increase
You can’t precisely know what a stock is worth so leave yourself a margin of safety. Only go into things where you could be wrong to some extent and come out ok. Borrowed money is the most common way that smart guys go broke
As an Investor, purchase easily understandable business whose earnings will be materially higher ten years on at a rational price.
Ideal business to buy: something that costs a penny, sells for a dollar and is habit forming
Don’t be emotionally involved with your stocks
A fool and his money are soon invited everywhere
Diversification may preserve wealth, but concentration builds wealth

The way to wealth is plain. It depends on industry and frugality
Don’t get caught up with what other people are doing. Being a contrarian or crowd follower isn’t the key. You need to detach yourself emotionally
Speculation is most dangerous when it looks the easiest
Excitement and expenses are enemies for investors

Life Wisdom

The happiest people do not necessarily have the best things. They simply appreciate the things they have
Put meaningful amount of money in a few things
If you buy things you do not need, soon you will have to sell things you need
Never risk what you have and need for what you don’t have and don’t need
Avoid difficult problems, not solve them
The chains of habit are too light to be felt until they are too heavy to be broken
The chains you put around yourself have enormous consequences as you go through life
Things you like to do should be a habit of yours but the things the world like to do should be a business of yours
One can best prepare for the economic future by investing in your own education. If you study hard and learn at a young age, you will be in the best circumstances to secure your future
Better to avoid than conquer
Do not save what is left after spending
You only have to do few things right in your life as long as you don’t do too many things wrong
If you are going to be thinking, might as well think big
Dumb decisions are part of the game
The happiest people do not necessarily have the best things. They simply appreciate the things they have
In order not to make too many stupid things, it is enough to make a few very important things
Never risk what you have and need for what you don’t have and don’t need
Intensity is the price of excellence
The difference between successful and very successful people is that very successful people say no to almost everything
If you find yourself in a hole, stop digging

If you cannot control your emotions, you cannot control your money
If you don’t find a way to make money while you sleep, you will work until you die
Read and fill your mind with competing thoughts, and decide which makes sense