The Nebraska native, an investing legend, a philanthropist and the business magnate Warren Buffett is often referred to as “Oracle of Omaha.” No one who is interested in the stock markets is unaware of this name. He has been investing since the age of 11 when kids normally spend their time in playing and reading comic books. By the time he was 16, he already amassed a corpus of $53,000 and there was no looking back.
His words are considered as Gospels of the share market and the investors and analysts all over the world read his annual letters to his company’s Berkshire Hathaway investors over and over to get cues. If such a man who is known to know all about investing says that he doesn’t know few things that can help you invest better then it is bound to create interest. Here is what he said in his letters at different times to his shareholders.
In his 2014 letter, Buffett said that he cannot in any way predict the exact time of how and when the market will bounce or fall and hence he advises the investors to buy shares in his or any company only if they are willing to hold them for a minimum of five years. He is never interested in short-term market movements and hence those looking for short-term profit should go someone else.
Addressing his shareholders in 2013, he told that he bought a 400-acre farm a few years back. Although he knew nothing about farming, he did well in it. This example was given to educate the investors that it’s not mandatory to know all details about a business for making a smart investment.
After the hurricane Katrina struck in 2005, Buffett told that he does not know answers to “all-important questions”, but takes enough precautions to sail through if any decision goes wrong or a calamity strikes. He always propagates diversification to reduce risk.
He has always maintained that the board of the company should align with the shareholder’s interest. In his 2005 letter, he said, “I don’t know any other board in the country in which the financial interests of directors are so completely aligned with those of shareholders as much as Berkshire’s board.”
Addressing his shareholders in 2002, he admitted that he has no knowledge of what the businesses he owns shares of will earn in the next quarter or next year.
Today he is on the board of many reputed companies and the moment people know that Buffett is interested in a particular stock it rises up instantly and thus what he says is bound to stir up interest.