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Yes, but Buffet doesn't then turn around and sell at that higher price, and even if he did the price would start going down as he sold his position. If his purc
by ericmay 5y ago
Yes, but Buffet doesn't then turn around and sell at that higher price, and even if he did the price would start going down as he sold his position. If his purchase is bad, in the long run the market will punish him, even if the stock price goes up in the short-term due to the positive signal from his purchase.
I certainly agree that Buffet can make moves that normal people can't, though. Goldman Sachs in 2008 is a great example.
- skybrian 5y agoValue investing (promoted by Benjamin Graham and adopted by Buffett) is largely about understanding when you're buying at a discount. Getting a discount is better even if you buy and hold. It's harder to do these days because everyone does it, so there are fewer bargains. But Buffett can still do it more often, due to the halo effect.
- scarface74 5y agoHe makes deals to limit his downside risks. https://www.forbes.com/sites/adamhartung/2014/11/19/why-you-cant-invest-like-warren-buffett-and-shouldnt-try/ https://www.forbes.com/sites/adamhartung/2014/11/19/why-you-...