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How’s it going today guys so today what we’re going to be talking about is some tips on how you can invest like warren buffett now warren buffett is one of the most successful investors of all time and i think right now his net worth is over seventy billion dollars as of 2017 so the guy has quite a lot of accomplishments under his belt and he has a lot of good tips
For people looking to get into investing and a lot of people when they look at investing what they’re looking for is like a short-term capital gain you’re looking to make quick money and that’s why there’s a lot of legal lure and a lot of people who look at those penny stocks and like really cheap stocks and what they want to do is they want to buy something really
Cheap and even if it’s a gamble they want that thing to pay off i’m like you know ten extra 20 x scale with it maybe twenty times their money back and that’s kind of like the exact opposite strategy that warren buffett has where he is more about buying stocks and companies that you want to hold for a duration of time and having that slow but steady growth over
Time so it’s definitely something to consider and i definitely do some of these things with my own investing and in my own portfolio and i’ll mention those to you guys as i go here but i mean i have six pointers i’m going to have to do what half and half as i can’t fit it all on the board so first here i got the first three pointers on how to invest like warren
Buffett and before i get into the video i just wanted to mention as well as everybody existed in my own personal stock market trading strategy i just wrapped up my ebook i’m working on for the last couple of months and i will link that up in the description if anybody’s interested in that okay so the first step for the first tip to invest like warren buffett is
To invest in the everyday essentials so berkshire hathaway which is owned by warren buffett has holdings in two simple areas that run our economy a couple of examples of these would be insurance companies utilities energy companies railroads retail manufacturing and finance so like i said a couple of these strategies that i actually do myself and one of these
Is having investments in utilities and energy i have a good amount of invested in a of my areas local utility company that does all the power lines as well as the electricity and gas for my area so i do have investments and utilities and that has been a pretty good dividend stock for me so it doesn’t really grow much near a year it has a slow but steady growth
But it’s actually a pretty good dividend stock so i get a nice little dividend from that stock there um there’s a quote 80 cents which is if you use it all the time you might want a slice of it so that’s a good way to think about it it’s something that you’re using day in and day out and you see everyone around you using this and you don’t see it going anywhere
Anytime soon that might be something good to invest in so berkshire hathaway has holdings and geico which falls under the insurance category duracell which is under the energy category and wells fargo which is under that finance category so the second way you can invest my warren buffett is to trust your gut so buffy no reason vests and companies he trusts and in
Determining if he trusts the company or not you look at a number of different factors this includes the reputation of the company the public behavior so how the company is acting with its public outreach how would act some in the press and what it’s addressing the public accountability of management as well as how the company treats every person involved in the
Process from the executives to employees to the communities and even the environment which is really important because there’s a lot of companies out there not so much now but maybe back in a time when warren buffett was really investing heavily in companies that were not very responsible with the environment and this was something that he considered as a factor
Of whether or not he would invest in that company early on which is really good because in a way that made them ahead of his time looking into that because now if there was a company out there that was being very bad very bad environmental habits there’d be a lot of negative press about that people are more conscious about the environment now which is good so the
Third step or the third tip on how you can invest like warren buffett is to ignore the news and this is something i’ve heard from a lot of different people and it’s hard to remember off the top of my head where i read this spot because i’ve read so many different books on investing in the stock market they all kind of just blend together and i’ll remember the
Little different tidbits but i won’t remember who actually wrote this or who wrote the actual things i’m trying to remember but what they said was them you should you shouldn’t buy the news you should instead buy the reaction to the news so that’s another point you’re under ignore the news but what more buffett says is that no long term good can come from reacting
To today’s economic news and he has a rule that each set is making a lot of money in the past that rule is the government will always act to stabilize the economy and this is where the opportunities lay so just for an example you could look at the bailout of the automotive industry that was the way that the government stepped in and stabilize the economy so if you
Are receptive enough to pick up on things like this there are tremendous opportunities in the fact of the government supporting certain companies or doing things to stabilize the economy and kind of return things to normal and then what he says as well is to think ahead of the news so you don’t want to be trading the news itself you don’t want to be following the
Herd you want to be a couple steps ahead and seeing how people are going to react to it and maybe seeing if there’s anything that’s happening that would involve the government step again to act to stabilize things so those are the first three pointers on how to invest like warren buffett okay so here are the other pointers on how to invest like warren buffett and
I know i said in the beginning i believe i said i had six pointers i don’t know where i got that number from i actually have eight so here are the remaining ones this your main slide here becomes the first tree already so the next tip on how to invest like warren buffett is to study a company’s return on assets and what this means is you want to find out how much
Money the company makes with the assets that it owns and what you’re looking for is it consistent 20% return on investment each year in his opinion this meant that the company was responsible with the purchasing of assets and they were making smart investments themselves so that was a sign for this is a company he wanted to invest in he also said examined trend
Lines and he gave an example of this as well of a company breaking a trend line he said for example let’s say you saw a company that was making a 10% we’re trying to return on investment with his assets suddenly making a 20% return on investment with assets he said those are the kind of things you want to look for you want to look for deviations from the trend
Lines that study these things so you can identify when maybe a company is making more money on its assets that it was in the past couple of years that’s something you want to look for number five would be to observe from the sidelines he suggests building a watch list of companies and then studying or watching the stock price over time he also suggests studying
How well the company makes money and this ties into studying a company’s return on assets he says that you should look for a company consistently making money where the stock may be out of whack so if you were looking and you found a company that was consistently making money but the stock price wasn’t reflecting them that might be an opportunity he says the next
Thing we kind of touched on this in the beginning more buffett is all about long term investment t not it not about investing in height or investing in something that’s going to give you or two or three times return on your investment in the short period time he’s more about buying things that are more stable the everyday essential than holding on to these things
For a great duration of time because that’s where the that’s what the potential really lays is where you buy and you hold the stock so warren buffett recommends that when you buy a stock you’re considering it to be an investment of a five-year minimum so that’s about how long you should be expecting to hold on to that company so he’s not really supporting or he
Doesn’t really do himself any short-term investing so that’s one way that you know you see here some people that do short-term trading others are more long-term i kind of do a blend of both but he is all about the long term investing um and then his seventh tip here that i had was to buy index funds so he basically said because all this stuff all these previous
Steps it takes a lot of you have to be very patient and you have to really know where to look and you have to do a lot of digging in order to come across these um gold mines that he’s talking about here when you’re looking for certain things in a company so they don’t just jump out at you you kind of have to go digging and you have to really care about the um the
Fundamentals of the company so he says if you’re an investor who doesn’t have the time to do all that if you don’t have the time to be doing all these previous steps ii suggest buying index funds because that gets you some exposure to the whole industry and you’re not necessarily having all your eggs in one basket where one company may do poorly with the industry
As a whole does well this gets you basically a piece of the action of that indexer industry while staying diversified so he suggests by index funds if you don’t have the time to do all this other stuff here and at number eight is to get back on warren buffett it’s like one of the most charitable people that i’ve ever really come across i mean some people may have
Donated more than him collectively but i wrote it in the description i don’t remember off the top of my head but i believe it was 25 billion that’s how much warren buffett has given to charities in his lifetime and i believe his will is structured such that he’s giving away like 99% of his wealth to charity when he passes away so he is like the epitome of this giving
Back so that’s why he actually includes that as part of his investment strategy is when you’re following these strategies or whatever strategy to follow and when you’re starting to make money you need to continue to get back to others who maybe don’t have much as you have so i was really glad that the couple of resources i read they all kind of mentioned this as
Part of its strategy so i wanted to bring that up as well because you really is a very charitable person and it’s something to admire but that’s pretty much on the investment strategy of warren buffett and if you follow these steps you can invest more like warren buffett and i’m going to do more of these kind of like i guess you could call this like a profile so
Looking at people who’ve made a lot of money in the stock market and kind of outlining their strategy so i have a couple on top of my head of people that i want to study and maybe do a video like this but if you guys have any recommendations on it really can be anybody who you want me to study how they made money some of their tips some ways you can invest or be
More like them i think it would be really cool because i feel like everybody has lessons to teach and you can learn something different from every single person so if there’s anybody you want me to do a profile of please drop it in the comments below and i’ll try to include that in a future video but like i said in the beginning if you guys are interested in my
Individual stock market trading strategy i just wrapped up by ebook about a month and a half ago and i’ve had a couple of people actually already reading it and they’re already trading and a couple people already even messaged me say that they’re already making a profit with my strategy so that’s really cool that’s pretty much all i got for this video i hope this
Information was helpful to you if it was please drop a like and if you want to be notified of future uploads please subscribe but thank you guys for watching this video
Transcribed from video
8 WAYS TO INVEST LIKE WARREN BUFFETT 📈 (Investment Strategy) By Ryan Scribner
