Home Finance The 8 Investment Lessons Learned From Warren Buffet

The 8 Investment Lessons Learned From Warren Buffet


By Bob Tom.

A significant number of people suffer losses when they try to invest and make money and they end up making the same mistakes that led to the losses. Budding investors can learn from and emulate the mindsets of successful investors such as Bill Gates and Warren Buffet. Warren Buffet investment lessons can help anyone achieve success in investing.

We will focus on Warren Buffet, who has been described as the best investor on the planet. These are some of the investment practices he employs:

1. Develop your investment mindset

Not everyone is business oriented but everyone can improve their business minds by reading business-related books. Warren Buffet invests a lot of his time studying business-related books and it has helped him develop knowledge, skills, and expertise in investment. We can assume that Warren Buffet investment ideas are gleaned from years of study and curiosity.

2. Practice patience in your investing

Whenever Warren Buffett buys a stock, he buys into the company. This means that he doesn’t sell the stock at every market bust or boom, rather he believes in the companies that he invests in and sticks with his investment for the long term.

He holds on to the stocks until he longer believes that there is value in these companies. One of Buffett’s quotes, which illustrates his penchant for long-haul investments is, “Regardless of how awesome the ability or endeavors, a few things simply require significant investment. You can’t create a child in one month by getting nine ladies pregnant.”

3. Prioritize value

Buffett believes that investors should understand that markets are driven by supply and demand and that investing in or buying stock in a company with solid growth during market down-turns are great opportunities to gain value. Buying a good stock at a great price is a great investment tip.

4. Check your emotions when investing

Human emotions are known to influence the market considerably more than any monetary model. Emotions can make a person hopeful for something that has never happened and will likely never occur.

Buffett recommends that controlling your emotions is considerably more imperative than your IQ. According to him, “Accomplishment in investing doesn’t associate with IQ. What you require is the demeanor to control the urges that cause other individuals harm in investing”.

5. Invest in what you are knowledgeable and passionate about

Buffett recommends that you never put your investment in a business that you do not understand. For instance, if you do not understand how a particular industry works, you should not investment in a company in the industry because you will not understand the signs and indices even when you see them.

In addition, if you don’t have adequate information about a company, it would be difficult to understand how the company will perform in the long run and also foresee what the company will become a couple of years down the line.

6. Live below your means

Despite having a net worth of $87 billion dollars, Warren Buffett lives in a shockingly unassuming home. He believes that people should not live lavishly, but should use their resources for things that produce real value.

7. Save first then spend the rest

People tend to pay bills first, spend the rest, and save last. According to Warren Buffett, this is the wrong approach to finances. Buffet recommends that people should put aside a set amount of money each month or from each paycheck as savings first, then pay their bills, then spend whatever is left over after paying bills.

8. Remember your roots

When he was in middle school, Buffett had a job as a paperboy delivering a Newspaper, The Washington Post. He then expanded that early activity into a deep-rooted association with the daily paper. Years later, his company became The Washington Posts’ biggest investor. He also made $53,000 by the age of 16 by making investments.

by the age of 16 by making investments.

In investing, remember your values and where you came from and you may discover unique opportunities for great investments.

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