Why now is the time to invest in ASX shares like Warren Buffett

Here's why its a great time to invest in ASX shares like the great Warren Buffett.

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It's a scary time on the markets.

Just yesterday, the S&P/ASX 200 Index (ASX: XJO) lost 9.7% in the worst day we've seen on the ASX since 1987. That takes the total losses for the '2020 crash' (official name yet to be determined) to over 30% for ASX shares.

Many investors will be telling you how they 'sold everything early' and are 'waiting for the bottom to buy back in'. They might laugh or eye you with patronising sympathy when you tell them you haven't sold everything yet (yes, that has happened to this writer).

But I think it's a great time to take a moment to think about how the greatest investor of all time – Warren E. Buffett – is investing right now.

Now unfortunately, we won't know all the juicy details until Berkshire Hathaway's 13F quarterly filing is released in May.

But fortunately, we already have a preview.

How does Warren Buffett invest in share market crashes?

According to one of my Foolish colleagues over in the US, Buffett has been buying up shares of one of his favourite holdings recently – the US carrier Delta Airlines.

Yes, you read that right, Buffett is buying airline shares in a time when they are seriously on the nose (for obvious reasons).

We can also look at Buffett's Bible-worthy collection of quotes that he has given out in his long career. Here's two to mull over:

"Be fearful when others are greedy and be greedy when others are fearful."


"Every decade or so, dark clouds will fill the economic skies, and they will briefly rain gold. When downpours of that sort occur, it's imperative that we rush outdoors carrying washtubs, not teaspoons. And that we will do."

And that explains why Buffett has been holding over US $100 billion of cash on Berkshire's books over the last couple of years (much to the chagrin of his shareholders). Until a month ago, the stock market was defined by greed. Today, it is full of fear, but might just be raining gold at the same time.

By raining gold, Buffett is referring to companies that are priced at a fraction of what they were last month.

On the ASX, that might be Qantas Airways Limited (ASX: QAN), Westpac Banking Corp (ASX: WBC) or Afterpay Ltd (ASX: APT). Not that I'm saying these are Buffett-worthy companies, by the way. They're just very cheap right now compared to historical prices.

I reckon Buffett is dragging his massive washtub outside as we speak. What are you doing?

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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