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
  • 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
  • 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

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
  • 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 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

  • You are right because your data and reasoning is right, it is not about the crowd

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