In order to ensure the safety of funds, Buffett always keeps a clear head and walks away when the market is the most excited and investors are the most greedy. 1968 In May, when the American stock market was crazy, Buffett thought that there were no stocks with investment value, so he cleared all the stocks and dissolved the company. Results From June 65438 to June 0969, the stock market crash gradually evolved into a stock market crash. From May 56438 to May 0970, each stock fell by more than 50% compared with the beginning of the year.
Buffett's steady investment and strategy of never doing "uncertain things" made Buffett avoid stock market disasters again and again, and also made his capital increase rapidly when opportunities came. However, many investors invest rashly without knowing the risk or having enough risk control ability, or they lose their awareness of risk control because they are too greedy. Mata Software believes that before making any investment, we should put the risk factors in the first place and consider how much risk we can bear once the risk occurs, so as to be in an invincible position.
Buffett's Financial Strategy
1. Be a long-term investor, not a short-term investor or speculator.
The main factor of Buffett's success is that he is a long-term investor, not a short-term investor or speculator. Buffett never pursues the short-term interests of the market and will not follow up because a company's stock will skyrocket in the short term. He will try to avoid companies whose value is overvalued by the market. Once you decide to invest, you will basically hold it for a long time. Therefore, even if we missed the Internet boom in the late 1990s, we avoided the huge losses brought by the bursting of the Internet bubble to countless investors.
Buffett has a famous saying: "An investor must act on the premise that his decision card can only make 20 holes in his life. Every time he makes a new investment decision, he can make one less decision in his life. " Buffett may not be the best in a relatively short period of time, but no one can perform better than the market average for a long time like Buffett. In Buffett's profit record, we can find that his assets have been growing steadily, but rarely skyrocketed. From 65438 to 0968, Buffett set a record of 58.9% annual income. It was also in this year that Buffett felt extremely uneasy, dissolved the company and retired.
Put all the eggs in the same basket and watch carefully. The debate about whether eggs and eggs are concentrated in one basket or scattered in multiple baskets has never stopped and will never stop. These are just two different investment strategies. From the cost point of view, it is easier and cheaper to take care of one basket than to take care of multiple baskets. But the key question is whether you can take care of the only basket. Buffett is confident because he always spends months, years or even years thinking about the rationality of investment before making an investment decision, and he will consult and track investors' financial statements and related information for a long time. He always avoids some complicated companies. Only after thoroughly understanding all the details can Buffett make an investment decision.