A few words about Buffett
Dear friends, downturns are tough, especially when it comes to historically exceptional events.
We suggest you revisit our previous posts on emotional management and behavior during downturns; you can find them here and here.
Read them again slowly; it will help you clear your head.
2 more words about Buffett
Everyone is talking about the legendary Warren Buffett, the only billionaire who, until last weekend, was profitable YTD compared to everyone else who lost hundreds of billions.
Why is this happening?
Because Buffett is the king of cash!
He holds almost $400 billion in cash.
Now let's analyze this for a moment. Buffett's investment company is 25% invested in Apple. Its stock portfolio is taking historic hits, so what if he has a lot of cash and bonds, why isn't he taking a hit?
The answer is simple.
In downturns, cash is king for one reason only.
- With cash, you buy.
Buffett is now acting during the downturn. He will buy heaps while everyone is in a panic; Buffett is on cloud nine.
He will buy hundreds of billions and double the investment very quickly.
These are returns like never before and investors understand this.
Friends. Be Buffetts.
Don't let emotions blind you.
- Remember that the market offers opportunities.
But for those who don't take such an opportunity, the opportunity won't wait for them.
When the market falls, it also opens doors. But whoever doesn't enter through the open door may find it has already closed.
- Keep calm and sit down for a calculated assessment.
- Look for opportunities within the chaos.
- Follow the news and look for signs of calm or a change in momentum.
- Don't panic.
"Be greedy when others are fearful, and fearful when others are greedy." (Warren Buffett).