What are the three principles of Buffett's investment?
1 Never lose money.
Buffett has a famous saying: the first is to keep the principal, the second is to keep the principal, and the third is to remember the first two. The first one is to tell everyone not to lose money, because if we lose money in one investment, we need a bigger return in the next transaction before we can recover the funds. However, it is difficult to guarantee income, let alone higher income. Therefore, from the beginning, we need to choose an undervalued high-quality company at the right time, so as to reduce the probability of our loss. If you find yourself running out of time, money and spiritual costs in a loss-making transaction, it is often time to leave.
Transfer money from activity to patience.
Actually, this is about long-term value investment. Buffett is very opposed to short-term trading, thinking that it is a waste of time and money, and it will also affect health. The best rewards always come from those who wait for the best opportunity before starting. So we need to keep active analysis, look for quality companies that sell at low prices, and wait patiently for them to reach a lower discount level before buying. Of course, after buying it, you don't just ignore everything and wait for the benefits. Because good companies are not necessarily good companies, there will be better companies in the market. All these require us to constantly investigate and adjust our investment according to the market.
* But for some investors with little capital, what they pursue is the rapid growth of wealth and the accumulation of assets, rather than stability, so they are often more willing to "do short-term and make quick money". In short, it mainly depends on personal abilities and needs.
3 Ignore the market
Many times, we tend to be too sensitive to market behavior. Even the black swan event usually affects the panic in the market, and panic will only lead to the decline of the external price of the stock, but will not have a substantial impact on its internal value. For value investors, the Black Swan incident is a good buying opportunity.
* Now many investors will blindly believe in such investment principles, ignoring that many of us may not be able to choose a good company without Buffett's insight into the future market. We also don't have enough funds to accumulate, and we can resist the crazy decline of stock prices.
In short, we should have our own judgments on various Buffett Three Principles, Four Concepts and Twelve Laws ... and publish them on the Internet. We can refer to these contents, but blind faith is not recommended. The investment principle of "stock god" does not necessarily apply to everyone, or even to every market. After all, the A-share market we invest in will be unique. Of course, there are also traffic suspects from the media. Buffett's investment success depends on these principles. You should know that investment can't be summarized in these words, otherwise everyone can become a stock god.