Warren Buffett talks about the bottom

Mondo Finance Updated on 2024-01-28

The financial crisis of 2008 caused the world to be repeated. While other investors are fleeing, Warren Buffett has made frequent moves, investing more than $28 billion in a total of more than $28 billion to acquire a large number of shares in Marmont Holdings, Wrigley, Rohm and Haas, Goldman Sachs, Constellation Energy, Tungaloy, General Electric and China's BYD. Who knows, Buffett's stock price continued to fall sharply after investing in the above-mentioned **, which caused global questions about Buffett's "incorruptible and old-fashioned, still able to eat".

In fact, the tide rises and falls, and if there is a big rise, there must be a big fall. **When the price rises, it is not easy to show which of the various investment strategies is better or worse, and it is immediately clear when it encounters a big fall. Warren Buffett's investment strategy is: **anti-corruption when the price rises and exit early**; Fight terrorism when it falls, and take the opportunity to take advantage of it; Buy big down, buy more and more down, instead of cutting meat and leaving the market. He believes that as long as investors have such determination, they will be one.

It will definitely outperform the market.

After careful investigation, there are three main measures taken by Buffett when he was in the first place: First, select investment industries. In the early days, Warren Buffett liked to use Graham's diversification method, no matter the industry, the management, or whether it was on the verge of bankruptcy, as long as the net worth far exceeded the stock price. This search for a smoke-belt approach did make him money, but when everyone used this strategy, he had to switch to Fisher's concentrated investment method, investing exclusively in a handful of superstar companies, and later making a multi-billion dollar stake in the company.

The second is to do value bands. Don't think that doing swing bands is your forte, Buffett's approach is different from yours. He first calculates the intrinsic value of each share from the overall value of the listed company, and then compares it to the stock price. Buy if the intrinsic value is significantly higher than the stock price, and then sell when the stock price is high. For example, he invested 500 million US dollars in 2003 ** PetroChina H shares, and in 2007 he sold them all, mainly based on the intrinsic value price) to do the band.

The third is to invest only with spare money. Even in the face of those who are expected to rise 100 times in the next 10 years, Buffett insists on investing only with spare money, and waits for opportunities when he loses; Once you lose everything, it won't hurt your muscles and bones, if you win the bet, you will definitely make a lot of money, and you won't have to worry about it for the rest of your life. The advantage of investing with spare money is that you don't have to panic even in the face of a negative decline that lasts for two or three years. Warren Buffett has experienced *** four times in his life, respectively, years. Every time a year or two ago, Buffett quit early, not participating in the last wave at all, but watching others fight stupidly in **. When the ** fell through, he entered the market on a large scale leisurely and comfortably, picking up the original ** one by one. For example, from 1984 to 1986, the United States** continued to rise sharply, with a cumulative increase of 246 times, Buffett has shipped on a large scale since 1985, making it clear that only 3 ** will be kept, and the others will be sold. When the stock index hit rock bottom in 1988, he started Coca-Cola and covered his position in 1989, investing a total of $1 billion.

At the same time, he also bought $600 million of Gillette convertible preferred stock. In 2008, Warren Buffett had a large scale of more than $28 billion, distributed in four major sectors: finance, consumer goods, medicine, transportation and energy. Warren Buffett believes that these industries are developing steadily and are prone to superstar stocks; With few tangible assets and strong profitability, only a small amount of tangible assets needs to be added to expand the scale, improve profitability and overcome inflation; The debt ratio is low, and it is not afraid of forced debt. This choice of investment timing and strategy is not without reference for Chinese investors.

It is easy to see that Buffett's investment cannot be simply understood as **, for him, buying ** is to buy a company, which is to invest in the future of the company. Warren Buffett claimed that there were only 4 ** that were worth holding in his life, and later fired 1, leaving only 3 ** in the Washington Post Company, **Employee Insurance Company, and Coca-Cola Company**. He sees investment as a marathon, believing that only athletes who finish the marathon are likely to win. This means that investment performance cannot be just a one-time one-share view, but must be considered in the long run.

In our country, investors always like to cut meat when they encounter ***. Cutting meat is undoubtedly painful, not to mention cutting your own flesh, which will definitely break the mentality and lead to emotional investment operations in the future. This kind of stock selection without intrinsic value in advance, stock exchange based on stock price fluctuations during the event, and blind stock selection based on news after the event is contrary to Buffett's investment strategy.

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