Warren Buffet Stock Picks - How to invest like Warren Buffett
Warren Buffett became the richest man in the world in 2008 according to Forbes magazine. Often described as the best stock investor in the world, Warren Buffett’s stock picks are closely followed and with good reason. In a study by Texas A&M University, it found that from 1976 to 2006, following Warren Buffett stock picks for the Berkshire Hathaway portfolio would earn 14+% per year.
So why not just buy Berkshire Hathaway shares? Anyone got $130k lying around for Class A shares? The Class B shares are more reasonable at $4k. However, as great a holding company as Berkshire Hathaway is, there is a worry that 77-year old Warren Buffett will not be at the helm of Berkshire Hathaway much longer. When Warren Buffett passes on, the share value will drop. Currently, one could say that Berkshire shares are not fairly valued because it is trading at a premium for that Buffett branding.
Warren Buffett Investment Strategy
There is much we can learn from Warren Buffett’s strategy. Warren Buffett invests in businesses that he understands. He likes the concept of business moats to protect the business from competition. He also likes that the company is run by good management. And to top everything off, Warren Buffett’s stock picks have to be priced right.
Can individual investors maintain such discipline as Warren Buffett? Perhaps. Individual investors hold the advantage because they have a smaller portfolio than Berkshire Hathaway. Berkshire Hathaway has to make big purchases in order to get noticeable returns. Individual investors do not have such a burden. Also, individual investors have their own unique perspectives of businesses they understand. Combining the strategy of following Warren Buffett stock picks and personal knowledge, an investor can beat Wall Street.
Related Posts
[...] For all intents and purposes, Warren Buffett already thinks that the United States is in a recession and it will be longer and deeper than what people are predicting. Let’s get one thing clear. Fortunes are made when people are in a panic. Stay the course of finding good companies and come out looking like a rose. Here’s your chance of making a fortune buy learning how to invest like Warren Buffett. [...]