9 Must Read Quotes By Warren Buffett For Investors

9 must read quotes by Warren Buffett for investors

Warren Buffett, the business magnet and most popularly known as "Oracle of Omhaha" is one of the person in the world on investing who is followed by most of the investors. People say he is the third richest person in the world, but i think he is much more than that. 

His knowledge and wisdom are priceless and we are fortunate to live in his era. there are many things which we can learn from him. He has simple rules which everyone knows but that is not the big issue. The big issue is not all of us can implement those rules in our real life. So today in this post we will try to gain knowledge about "9 Must Read Quotes By Warren Buffett" and try to understand the quotes properly.

9. Never invest in a business you can’t understand

As I have mentioned earlier that most of the people knows this quote by the legend but do they religiously follow this? No! Whenever I ask to show the portfolio to my clients, I see 90% of stocks in their portfolio are those companies about which I even don’t know. When I ask them why you invested in this company their simple answer will be, “Mr. X had recommended”. 

All the investors should understand that it is real money in the stake and you should know all the little details of business before you invest. This is necessary if you want to grow your money otherwise it is fine.

8. If past history was all that is needed to play the game of money, the riches people would be librarian.

This is also a well written quote by Warren Buffett. In this quote he tries to tell a very simple thing which people fails to understand. When we watch business news channels there are hundreds of recommendations, which are given by experts on daily basis. Mostly these are done by technical analysis. 

Technical analysis’s foundation is charts and volumes of the stocks. Again the technical analysts study the past patterns and volumes of the stocks and how they reacted at that time. On this basis they try to predict the future moves of the stock which is showing same pattern. An investor should know one thing that “No one can tell what will happen in next moment in this market”. I always tell to my clients that “I can’t give guarantee”, why? Because I know no matter how much intelligent I am, the market has its way of operation and if you are sure about something then you should think again. Only technical analysis will never help the investors. They have to gain the insights of the business.

7. The rich invest in time, the poor invest in money.

In this quote Mr. Buffett gives a hint about which is more important. He tells that rich peoples often invest in time whereas poor people invest in money. Now why investing in time is important. Because you have “LIMITED TIME”. This is the only scarce resources you will face in your life. Money is never meant to be a scarce resources. This is why you should have an awareness about your precious time and how you are spending it. 

People wants their money double in one year or two years. They are not willing to learn, they are not willing to acquire required knowledge, they are not willing to read. They simply want to invest their money on stocks and they think it will work for them. Sad truth is it never happens. Rich people invest in reading books, acquiring new skills, learning more and more. By this they always have an edge over normal investors. 

6. If you are in a poker game and after twenty minutes you don’t know who the patsy is, then you’re the patsy.

This is one of my favorite because this is also not known by many people. In this quote Warren Buffett signifies the importance of knowing the game you are playing. If you don’t know the rules of game and how to play the game, then even a kid can say that you are going to lose the game. 

That’s why it is very very important to know what you are doing, where you are investing your money and why you are investing money in the stock market or a particular stock or instrument. Patsy mean the person who is easily cheated by someone and an easy target for the real gamers. Mr. Buffet is one of the big name in the investing world and believe me this advice is something which all of us should know.

5. Risks come from not knowing what you’re doing.

This is almost an extension of the previous quote. What is risk? When you don’t know the outcome of an event. We take insurance cover because we don’t know what will happen to our life in next moment. So risk is always there when you have no idea what you are doing in this market. If you know that why you have invested in a particular stock, then you will never feel risk because your intention is clear with your strong analysis. 

I have felt this in my real life experience. This is the most important changes in me since I started investing. Before 4-5 years I used to feel unsafe and there was a fear of losing money but today I’m confident whatever decisions I make. Today even if my portfolio shows negative return, I won’t worry because I know these things are temporary and my analysis is permanent. 

4. Only when the tide goes out, you discover who’s been swimming naked.

If you have spent years in this market, then you must have seen that when the bull market come each stock starts to rally. We see every day there is new 52 weeks high and everybody is earning. At that time, it feels so easy to earn money in this market. But that is a false dawn. 

You have to understand that nothing is easy in this life and if you see something easy like that, then you should become aware and take steps cautiously. After the rally is over then you will know which stocks are really able to sustain their price and which stocks failed to sustain their price and comes to their original level. This is a cautious quote for investors that don’t invest blindly.

3. I don’t look jump over seven foot bars; I look around for one foot bars that I can step over.

This is to make understand people that stock market is not a casino where your money will grow in an impossible manner. This means you should not expect which is impossible. Many people expect to double their money in single year. Many people want to become millionaire and billionaire overnight. There are no such things exist in this world. You have to work hard and expect which is real. 

In stock market if you are getting return more than 10% per annum then believe me you are getting bonus. So don’t expect like 25-30% in a year. It is possible but you shouldn’t expect this. If it comes then go enjoy your holiday but investing with the sole purpose of earning 30% in a year is foolishness.

2. Should you find yourself in a leaking boat, energy devoted to changing vessels is likely to more productive than energy devoted to patching leaks.

When you find any of your analysis is going wrong and you find yourself in a loss then you should try to look other opportunities available in the market rather than focusing on the same stock. Most people do averaging when their stocks go in wrong direction. This may be a way to avoid losses but it is not “Warren Buffett’s way". Opportunities are available in this market all time. You just need to figure it out and invest your money there by booking loss in your loss making stock.

1. Without passion, you don't have energy. Without energy you have nothing.

To achieve success in anything you need energy which will drive you to wards your goal. If you are doing anything which you don't have passion then believe me, you are just wasting your precious time. In our life if we want to be happy then this is the only thing which we all should realize that love your work. You are in stock market just because your friends is in then you can never make money out of this. But if you have real passion for this market then you will definitely make money and become a winner.

So these are the 9 quotes which gives us an insight of Warren Buffett's way of investing. I hope you all must have enjoyed this article. Leave a comment and that will encourage me.

Thank you, stay healthy and happy investing.

9 Must Read Quotes By Warren Buffett For Investors 9 Must Read Quotes By Warren Buffett For Investors Reviewed by Ashish Kumar on February 23, 2019 Rating: 5

1 comment:

  1. All of these quotes are really awesome. Thanks the author for sharing this post. Really this is a very helpful post for beginners like me. If anybody wants to learn how to trade stocks then take a look at www.livingfromtrading.com


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