Warren Buffett is one of the best investors in history, and is widely regarded as the “Oracle of Omaha.” Buffett is a value investor at heart, but he also shares a lot of other insights during shareholder meetings and in his annual letter to shareholders. As such, it is pretty easy to understand Warren Buffett’s investing philosophy.
1. Cash Is King Cash is a big deal to Warren Buffett, and he keeps a lot of it on hand at any given time. The reason? In Warren Buffett’s words, he keeps a lot of cash on hand “so that we can both withstand unprecedented losses and ... quickly seize acquisition or investment opportunities.”
2. Be Fearful When Others Are Greedy One of Buffett’s most famous phrases is, “Be fearful when others are greedy, and greedy when others are fearful.” This great sentiment is very true of our stock market and investing system.
The bottom line is that you should avoid the stocks that everyone else is buying, as they probably are overvalued. Instead, look for the stocks that few people are paying attention to, check their fundamentals, and invest if it makes sense.