“..approval is not the goal of investing. In fact, approval is often counter-productive because it sedates the brain and makes it less receptive to new facts or re-examination of conclusions formed earlier. Beware of investment activity that produces applause: the great moves (when made) are usually greeted by yawns.”
- Warren
Buffett, p.16 of 2008 Berkshire Hathaway annual report.
“Individuals who cannot master their emotions are ill-suited to profit from the investment process.”
- Benjamin Graham, the ‘father’ of Value Investing.
Consider
the following, real life, example of comparative returns (for which I am
indebted to Kokkie Kooyman of Sanlam Investment Management). Imagine you
invested $10,000 into shares of Warren Buffett’s now legendary holding company,
Berkshire Hathaway, at the end of 1971. Then imagine you (or better still, a
sibling, or friend) invested $10,000 into the S&P 500 Index. The table
below shows how your investments fared.
To read more,
Download Indecent haste
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