Warren Buffett and Charles Munger advice for small investors?
The investment philosophy at Berkshire Hathaway is well known: Buy great businesses that are run by great people and keep them 'forever'. However, I believe Buffett/Munger have said that 'Buy and Hold Forever' may not be the best method for people with smaller amounts of capital.
So, the question is: What methods have they recommended for small investors?
[Please, in your answer, include the source/reference.]
Thank you for your time.
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Warren Buffett: 'Investing Advice For You--And My Wife' (And Other Quotes Of The Week):
What I advise here is essentially identical to certain instructions
I’ve laid out in my will. One bequest provides that cash will be
delivered to a trustee for my wife’s benefit…My advice to the trustee
could not be more simple: Put 10% of the cash in short-term government
bonds and 90% in a very low-cost S&P 500 index fund. (I suggest
Vanguard’s.) I believe the trust’s long-term results from this policy
will be superior to those attained by most investors…
Similarly from Will Warren Buffett's investment advice work for you?:
Specifically, Buffett wants the trustee of his estate to put 10
percent of his wife's cash inheritance in short-term government bonds
and 90 percent in a low-cost S&P index fund - and he tips his hat
specifically to Bogle's Vanguard in doing so. Says Buffett: "I believe
the trust's long-term results from this policy will be superior to
those attained by most investors - whether pension funds, institutions
or individuals."
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