Who is Warren Buffett?
- Born 1930, Omaha, Nebraska
- Started managing funds in 1956 with the formation of the Buffett Partnership (dissolved in 1969). Now chairman and major owner, Berkshire Hathaway Inc
- $1,000 invested with Buffett in 1956 would be worth $ 25,289,750 as of 31 December 2002
- Annual compounded rate of return of 24.7%
- Number of losing years is only 1 in 2002 in comparison with 13 down years for the S&P500 since 1956
My 10 Biggest KEY Takeaways from WARREN BUFFETT:
- Risk comes from not knowing what you are doing
- It is only when the tide goes out that you discover who has been swimming naked
- Our favourite holding period is forever
- Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks
- Get a good grip on one thing that matters the most—the price you pay
- It is far better to buy a wonderful company at a fair price, than a fair company at a wonderful price
- Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years
- Only do things when the opportunities come along if not don’t do anything
- Be greedy when others are fearful and be fearful when others are greedy
- The most important investment that we can ever make is not in stocks but in ourselves
Who is Peter Lynch?
- America’s number-one money manager
- He was the portfolio manager of Fidelity Magellan Fund, which was the best performing fund in the world under his leadership from May 1977 to May 1990
- His motto: Average investors can become experts in their own field and pick winning stocks as effectively as Wall Street professionals by doing just a little research
My 10 Biggest KEY Takeaways from PETER LYNCH:
- Understand the nature of the companies you own and the specific reasons for holding the stock
- Big companies have small moves, small companies have big moves
- Look for small companies that are already profitable and have proven that their concept can be replicated
- Avoid hot stocks in hot industries
- It’s better to miss the first move in a stock and wait to see if a company’s plans are working out
- Companies that have no debt cannot go bankrupt
- A lot of money can be made when a troubled company turns around
- Buying stocks based on stated book value alone is dangerous and illusory. It’s real value that counts
- Invest at least as much time and effort in choosing a new stock as you would in choosing a new refrigerator
- Insider buying is a positive sign, especially when several individuals are buying at once
Disclaimer: The information provided is for general information purposes only and is not intended to be personalised investment or financial advice.
Important: Please read my full disclaimer.
CHRIS LEE SUSANTO
Hi, my name is Chris and I am the founder of Re-ThinkWealth. A blog that focuses on personal finance self-improvement, investments, and investor psychology.
Since early 2015, I manage money for my family and invests it in Singapore and United States equities and options achieving above market return.
I use Value Investing and Options Selling strategies used by Warren Buffett (World’s richest investor) coupled with the core theory of inversion. Inversion meaning that in every investing idea, we have to scrutinise on why it would fail.
This will result in us being more conservative, and being conservative is the key to protecting and growing wealth in the long run.
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