Last week, global investors learned that Berkshire Hathaway CEO Warren Buffett is planning to step back from managing the business at the end of 2025. Greg Abel will take over the day-to-day running of the business.
However, Buffett will seemingly stick around as the chair of the business, according to reporting by CNBC.
Warren Buffett is currently 94 and will be 95 by the time he hands over the reins to Abel. Over the decades of leading Berkshire Hathaway, he has given numerous pieces of excellent advice.
I'm going to share with you some of my favourite quotes from the Oracle of Omaha and why I like them.
Hamburgers
The following may well be my favourite investment quote:
To refer to a personal taste of mine, I'm going to buy hamburgers the rest of my life. When hamburgers go down in price, we sing the 'Hallelujah Chorus' in the Buffett household. When hamburgers go up in price, we weep. For most people, it's the same with everything in life they will be buying — except stocks. When stocks go down and you can get more for your money, people don't like them anymore.
This shows the mentality of the man. It's good to be greedy when other investors are fearful because we're being presented with the best share prices during market sell-offs. It's smart to take advantage of those lower prices, in my view.
Investing rules
Warren Buffett has never truly outlined how he developed his investment strategy, though it's fairly clear from his investments in businesses like Apple, Coca-Cola, and American Express what sort of companies he likes.
But, there are a few things that he takes into account when investing, which is what this quote and the next two are about.
Buffett once explained two rules related to his investing:
Rule number one: never lose money. Rule number two: never forget rule number one.
If an investor can eliminate the investments that go (really) bad, that's a strong boost for their overall net returns.
Low hurdles
This next quote from Warren Buffett relates to the sort of investment returns he's trying to make when he invests. I'm sure it partly relates to when he invests, not just what he invests in. He said:
I don't look to jump over 7-foot bars, I look around for 1-foot bars that I can step over.
In other words, he's looking for investments that are likely to work out, rather than high-risk picks with a significantly lower chance of working out.
Long-term investing
Warren Buffett has an excellent mentality for investing in the stock market. A key part of his strategy is that he thinks about where businesses will be in the long term, not just six months ahead.
By focusing on the long term, you can think clearly about what could do best in a reasonable timeframe, and avoid short-term trading.
How long-term should we think? Warren Buffett said:
Only buy something that you'd be happy to hold if the market shut down for 10 years.
Of course, that doesn't mean we have to own any particular stock for a decade, but it's good to keep this in mind.
Warren Buffett has taught the world's investors so much, and these are some of the lessons I'll try to take with me for the coming decades.
