Basically, the single-most important decision in evaluating a business is pricing power. Warren Buffett More Quotes by Warren Buffett More Quotes From Warren Buffett When asked how he became so successful in investing, Buffett answered: 'we read hundreds and hundreds of annual reports every year. Warren Buffett investingsuccessfulyears Nothing sedates rationality like large doses of effortless money. Warren Buffett rationalityinvesting-moneybuffets We enjoy the process far more than the proceeds. Warren Buffett investingbusinesswar Investors should be skeptical of history-based models. Constructed by a nerdy-sounding priesthood using esoteric terms such as beta, gamma, sigma and the like, these models tend to look impressive. Too often, though, investors forget to examine the assumptions behind the models. Beware of geeks bearing formulas. Warren Buffett esotericgeeklooks It's easier to create money than to spend it. Warren Buffett easier Investment must be rational; if you can't understand it, don't do it. Warren Buffett rationalinvestmentifs My wealth has come from a combination of living in America, some lucky genes, and compound interest. Warren Buffett wealthluckyamerica Unless your answers are clearly better, copy the answers of your betters. Warren Buffett copiesanswers Businesses always have opportunities to improve service, product lines, manufacturing techniques, and the like, and obviously these opportunities should be seized. But a business that constantly encounters major change also encounters many chances for major error Warren Buffett errorstechniqueopportunity A pin lies in wait for every bubble. And when the two eventually meet, a new wave of investors learns some very old lessons: First, many in Wall Street (a community in which quality control is not prized) will sell investors anything they will buy. Second, speculation is most dangerous when it looks easiest. Warren Buffett walllyingknowledge In our view, though, investment students need only two well-taught courses-How to Value a Business, and How to Think about Market Prices. Your goal as an investor should simply be to purchase, at a rational price, a part interest in an easily-understandable business who's earnings are virtually certain to be materially higher five, ten and twenty years from now. Warren Buffett viewstwothinking The fact that people will be full of greed, fear, or folly is predictable. The sequence is not predictable. Warren Buffett investinggreedpeople Investors making purchases in an overheated market need to recognize that it may often take an extended period for the value of even an outstanding company to catch up with the price they paid. Warren Buffett investingmayneeds It's nice to have a lot of money, but you know, you don't want to keep it around forever. I prefer buying things. Otherwise, it's a little like saving sex for your old age. Warren Buffett buying-thingsnicesex Derivatives are like sex. It's not who we're sleeping with, it's who they're sleeping with that's the problem. Warren Buffett derivativessleepsex With a wonderful business, you can figure out what will happen; you can't figure out when it will happen. You don't want to focus on when, you want to focus on what. If you're right about what, you don't have to worry about when Warren Buffett what-iffocusworry Problems in a company are like cockroaches in the kitchen. You will never find just one Warren Buffett kitchencockroachesproblem You don't ever ask a barber whether you need a haircut. Warren Buffett humorfunnyneeds Never get too hung up on mistakes. Warren Buffett hungmistake There is nothing like writing to force you to think and get your thoughts straight. Warren Buffett forcewritingthinking
