Warren Buffett, who is called a stock market teller and many investors, and even countries are waiting and waiting for where his investment will go, as he is really considered a compass for investors around the world .. Warren Buffett bought his first stock when he reached 11 years and at the age of sixteen his fortune reached 53 thousand dollars .. Warren Buffett now is the Chairman of Berkacher Hathaway, who is 90 years old, has a fortune of about $ 76 billion and is the seventh on the list of the world’s richest people. In this article, I will highlight the 5 most important investment advice for individuals from Warren Buffett.
The first advice from Warren Buffett: Be afraid when others are greedy and be greedy when others are afraid..it is one of Buffett’s most famous phrases and can be applied in the stock market and investment. This advice means that the investor should avoid buying stocks that everyone else is going to. It may be overpriced, so Buffett advises investors to look for stocks that few people are interested in, verify and invest in them if they are financially and technically good.
We turn to the second advice from Warren Buffett to investors, which is saving, as Warren Buffett is known to save a lot of money for two reasons: bearing potential losses, and seizing opportunities for acquisition and investment. In times of crisis, in addition to the fact that this saved money can be used to buy shares when their price decreases, thus this means making large profits when their price increases again.
The third advice is to focus on buying shares of companies that distribute profits .. because it reflects that the financial position of the company is in good condition to pay off its obligations and also that it is a company that makes profits … and Buffett is very much preferable to invest in these companies, especially those that distribute profits for long periods, whose profits rise and increase with the passage of time. Therefore, do not choose the share of a company that distributes profits in a year, and then two or three years after achieving a loss .. This means that it is a company that has benefited from some circumstance for a specific period and cannot continue to make profits.
We turn to the fourth advice from Warren Buffett, which is to buy undervalued shares, Warren Buffett always buys shares estimated at less than their real value, and calculates the real value of the company’s shares by looking at the return on investment and operating margins during the past five years or more, and makes sure whether the company has debts or not. Then, he compares the company’s position with similar companies, to see if its shares are undervalued or not.
We come for the fifth advice and the last, which is to buy and hold, it is known from Warren Buffett that he loves to buy stocks and keep them for long periods, but on the other hand he makes sure that this does not mean that he keeps holding a company with losses or a successive decline in its profits, and here we look at his investment portfolio and if it loses A company with a competitive advantage, he either sells or reduces his shares in that company. Buffett advises investors to be patient and wait for the right price and opportunity to buy.