The Berkshire Hathaway annual letter was released this past weekend. It was one of Warren Buffett’s shortest letters to date.
But it wasn’t without a few lessons. As usual, Buffett scattered several lessons and reminders for investors throughout. The lessons were just briefer than normal. Let’s dive in.
Buy Businesses, Not Pieces of Paper
Whatever our form of ownership, our goal is to have meaningful investments in businesses with both durable economic advantages and a first-class CEO. Please note particularly that we own stocks based upon our expectations about their long-term business performance and not because we view them as vehicles for timely market moves. That point is crucial: Charlie and I are not stock-pickers; we are business-pickers.
Buffett makes two important points. He’s not trying to profit off of short-term swings in the market. He knows market timing is a fool’s errand. Continue Reading…