Berkshire Hathaway founder and chairman Warren Buffett has offered a variety of investment advice over the years. Known for taking a long-term approach to stocks, sticking to fundamentals and taking calculated but thoughtful risks, the so-called Wisdom of Omaha is a frequent move online.
In investment circles, Buffett and his longtime business partner and friend, the late Charlie Munger, are known for their no-nonsense approach to business and relatively modest lifestyles compared to their immense wealth.
Quote of the day from Warren Buffett
“When we see something that makes sense, we’re willing to act very quickly, very broadly, but we’re not willing to act on anything that from our point of view is uncontrollable. You don’t get paid for activity. You only get paid for being right.”
What does Warren Buffett’s quote mean?
In response to questions at Berkshire Hathaway’s 1998 annual meeting, Buffett said that he and Munger were “not willing to act on anything that we don’t think is going to be met.” He added that investor confidence in Berkshire comes from faith in Buffett and Munger’s ability to make the best decisions. He said, “You don’t get paid for activity. You only get paid for being right.”
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Munger added in the same Q&A session that the “occasional dull period”, i.e. a period without active investment, is “no great tragedy”.
The outlook is consistent with Buffett’s oft-repeated investment philosophy that patience pays off. When asked about the “missing” wave of tech stocks in 2011, Buffett told Bloomberg he had no regrets. The ace investor added: “I don’t have to be right about hundreds of things. I don’t have to be right about dozens of things. I can only be right about a few things if I know the game in this arena.”
Over the years, he has repeatedly suggested investing in companies that have an “economic moat” around them, or companies with a strong competitive advantage and long-term growth prospects; and stick to stocks. Speaking to students at the University of Georgia’s Terry College of Business in 2001, the billionaire shared a key metric that can be used to make investment decisions — to think of opportunities as marks on a 20-slot punch card where “every financial decision you made, you used up an awl.”
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His view is that treating investment opportunities as a single punched card with only 20 punches in your lifetime would ensure: “You think long and hard about every investment decision – and you’d make good ones and you’d make big ones. And you probably wouldn’t even use all 20 punches in your lifetime. But you wouldn’t need to.”
WATCH: Warren Buffett on his investment strategy
Who is Warren Buffet — the ‘Oracle of Omaha’?
Buffett and Munger were the architects who transformed Berkshire Hathaway Inc. over nearly 60 years. from a failing textile manufacturer to an empire worth billions. Decades of compounding returns have made the pair of billionaires and folk heroes adoring investors.
Notably, in January of this year, Buffett handed over the reins and the position of CEO to successor Greg Abel. But his ‘bull run’ with Berkshire is legendary – over 60 years (1964-2024), he earned over 55,00,000% returns, built the group to $1.2 trillion and expanded its Class A shares to a value of $167 billion.
Known as the ‘Oracle of Omaha’ for his mysterious stock forecasting, Buffett gained fame and investor confidence by picking companies (Apple, Bank of America, Coca-Cola, etc.) that exploded and now make up 70% of Berkshire’s $263 billion stock portfolio. He called it how “one great deal can balance out the many mediocre decisions that are inevitable”.
Buffett’s net worth is estimated at $152 billion, making him the 10th richest person in the world, according to the Bloomberg Billionaire Index.
