Asian Games torch to arrive in host city Wednesday

Warren Buffett’s 5 rules for investing

kh close

 

Published : 2014-02-25 14:37
Updated : 2014-02-25 14:37

Fortune Magazine has an excerpt from Warren Buffett’s annual letter to Berkshire Hathaway shareholders. CNN Money reported his five rules for better investing.

Warren Buffett (Bloomberg)
1. “You don’t need to be an expert in order to achieve satisfactory investment returns.” But Buffett also warns that investors should recognize their limitations and “keep things simple.”

2. “Focus on the future productivity of the asset you are considering.” Buffett notes that no one can perfectly forecast the future profitability of an investment. “[O]mniscience isn’t necessary; you only need to understand the actions you undertake.”

3. “If you instead focus on the prospective price change of a contemplated purchase, you are speculating.” Buffett has nothing against price speculation. But he emphasizes that it’s important to be able to know the difference between investing for the productivity of the asset versus investing on hopes that the price of the asset changes.

4. “With my two small investments, I thought only of what the properties would produce and cared not at all about their daily valuations. Games are won by players who focus on the playing field -- not by those whose eyes are glued to the scoreboard. If you can enjoy Saturdays and Sundays without looking at stock prices, give it a try on weekdays.” In other words, focus on the long-run.

5. “Forming macro opinions or listening to the macro or market predictions of others is a waste of time. Indeed, it is dangerous because it may blur your vision of the facts that are truly important.” So mute CNBC, Bloomberg TV, and Fox Business. Unless Warren Buffett comes on.

(khnews@heraldcorp.com)

Photo News

티아라 효민 멋진 뒤태에 남심 흔들

섹시백 선발대회 몸매 뽐내는 참가자들

카자흐 女배구선수 초특급 미모, 전세계 ‘깜짝’