Investing Rules the Legendary Warren Buffett Lives By

Investing Rules the Legendary Warren Buffett Lives By

 

Rule 1: Never Lose Money

Rule 2: Never Forget Rule No. 1

Rule 3: Pick Businesses, Not Stocks

Rule 4: A Wonderful Company at a Fair Price vs. a Fair Company at a Wonderful Price

Rule 5: Our Favorite Holding Period Is Forever

 

"If you aren't willing to own a stock for 10 years, don't even think about owning it for 10 minutes.

 

Rule 6: Be Willing to Be Different

Rule 7: Avoid Credit Card Debt

 

Rule 8: Invest in What You Understand.

 

The essence:

 

The short answer is to buy undervalued stocks with solid long-term potential. The longer answer is that it requires research and a steady commitment to the companies in which you're invested. Hold them through thick and thin, ignoring market volatility, unless something material changes in the company's outlook, such as product obsolescence.