Does Following Warren Buffett’s Investments Really Do Any Good?

DOES FOLLOWING WARREN BUFFETT’S
INVESTMENTS REALLY DO ANY GOOD?
By www.ProfitableInvestingTips.com

http://profitableinvestingtips.com/stock-investing/does-following-warren-buffetts-investments-really-do-any-good
Every so often we read an article about
how you should invest like Warren
Buffett in order to achieve success in
the stock market.

But, does following Warren Buffett’s
investments really do any good or is it
simply better to imitate his approach?

Click the links below to get your
FREE training materials.
Free Weekly Investing Webinars
Don’t miss these free training events!
http://www.profitableinvestingtips.com/free-webinar
Forex Conspiracy Report
Read every word of this report!
http://www.forexconspiracyreport.com
Get 12 Free Japanese Candlestick Videos
Includes training for all 12 major candlestick signals.
http://www.candlestickforums.com
Before We Continue…

After all when Buffett invests a few
billion in a company its price commonly
goes up.

And, investing just after the stock price
goes up is not an especially good idea.

The Street just published an article
about how to invest like Warren
Buffett.

In a letter to his Berkshire Hathaway
(BRK.A – Get Report) (BRK.B – Get
Report) shareholders in 2013, Buffett
said his advice for the average investor
“could not be more simple.”

He suggested putting 10% of cash in
short-term government bonds and 90%
in a “very low-cost” S&P 500 Index
fund.

In that letter, Buffett suggested
Vanguard’s variety of funds.

If index funds aren’t for you, look out for
some of Buffett’s “moats” — as in the
water-filled ditch that keeps a castle
safe from attack.

Buffett has called positive free cash
flows, good return on capital and strong
competitive advantages within an
industry “moats” for companies.

Investors can flock to those moated
names by investing in a basket of
Buffett-like stocks through Motif
automated investing service for $10 a
trade.

Although Buffett hasn’t approved any
himself, the Motif fund focuses on
similar investing techniques.

The point is not necessarily to buy what
the Oracle of Omaha just bought but to
follow his suggested approaches of
either using an index fund or looking for
solid companies with a strong
competitive advantage, high cash flow
and low debt.

Additionally, Buffett says he does not
invest in a company unless he can see
how it will be making money five or ten
years from now.

He has said that he is not sure how a
tech product will be doing in a few
years but has a fair idea that Snickers
bars and Coke will be popular and
profitable.

Matching the Market Instead
of Beating It

Buffett is famous for saying that anyone
who bets against the American
economy and American industry is
crazy.

He has also said that by the year 2100
the S&P 500 will be a million.

For those willing to stay the course and
trust the market there are profits to be
made.

FT Advisor discusses passive
strategies for long term gains.

Passive investing has become the
strategy of choice for thousands of
investors.

Satisfied with duplicating market
returns instead of beating them, these
investors buy index trackers or the like
and own tiny pieces of thousands of
stocks, earning returns from the upward
trajectory of corporate profits over time
via the stock market.

Observers need only to look at the
industry flows of the past few years to
judge how significant index investing
has become.

Yet by definition these strategies will
only ever perform in line with their
index, minus the small cost of investing.

Are you a passive or active investor?
Read our article and see if you should
follow Buffett’s investments or his
advice.

Does Following Warren Buffett’s Investments Really Do Any Good?

More Related Content

More from InvestingTips

Does Following Warren Buffett’s Investments Really Do Any Good?