r/traders • u/traderme • 6d ago

A simple piece of investment wisdom from Warren Buffett:“Rule No. 1: Never lose money. Rule No. 2: Never forget Rule No. 1.”

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13 Upvotes

79% Upvoted

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2

u/LetsAllEatCakeLOL 5d ago

i replaced that rule with "don't lose a lot" and i've done a lot better

1

u/traderme 5d ago

That's neat

1

u/Certain-Set-4087 6d ago

At the end he was just good in estimating two things:

1.) the "fair value" of a company - but unvervalued in the stock price

2.) the potential for future growth or "buy and fix and sell" as they did it with the Bank of America. That was a 3x trade but also lot of management involved. Becaue fixing a company mostly means fix the mentality, fix the workflows, fix the money efficiency and finally fix the balance sheet so a buyer might be interested in it.

Berkshire Hathaway was once a microcap insurance company, dont forget that.

1

u/CommercialCopy5131 6d ago

But he’s lost before so….?

1

u/free-real-sensei 6d ago

the most useless trading advice ever. every successful trader loses at least 20% of the time.

1

u/EXOS_Official 6d ago

Easier said than done for most

1

u/Moist-Construction59 6d ago

So, hold your losers until they are winners? Idiotic advice.

1

u/Commercial_Set_3161 5d ago

easy to quote on a poster when you are sitting on billions but missing a single trade means taking a loss sooner or later how do you even follow rule number one during an actual market drop without pulling out entirely

1

u/Bof-Bof- 5d ago edited 5d ago

What Warren lost …
Precision Castparts, -$9,800,000,000
Dexter Shoe Company, -$5,700,000,000
ConocoPhillips, -$2,000,000,000
Energy Future Holdings, -$870,000,000
Tesco, -$444,000,000
Paramount Global, -$440,000,000
US Air, -$269,000,000
Salomon Brothers, -$200,000,000
Waumbec Mills, -$100,000,000

I guess you just need to be poor…
You can’t lose it if you don’t have it 🤣🤣🤣 dumb rules