Warren Buffett's advice to investors: Stick with stocks


Warren Buffett's advice to investors: Stick with stocks

Buffett says the big lesson for investors is "stick with the big, easy decisions and eschew activity". (NASDAQ:AAPL)'s shares become key-centric, as the renowned investor, Warren Buffett appetite for AAPL stock surges.

Warren Buffett's Berkshire Hathaway, which owns substantial insurance and reinsurance operations, posted record quarterly and annual results for 2017 - mainly fuelled by the big cuts to United States corporate income tax, signed in by President Donald Trump a year ago.

"We're looking for something much bigger than that", he said.

Buffett said his $3-billion investment in preferred warrants at a 10=percent coupon generated a profit.

GE's accounting woes prompted the need to restate its financial results, so obviously its accounting practices are "not a model at all" for other companies to follow, Buffett said.

Buffett said it seems like Wells has gotten "all the cockroaches out of the kitchen" but wasn't completely sure.

The three announced last month a venture created to cut health costs and improve services for their US employees.

Buffett said investors can get clues about what he likes best by looking at Berkshire's portfolio.

Buffett is quick to point out that, "In any upcoming day, week or even year, stocks will be riskier-far riskier-than short-term USA bonds", but that over a long-term horizon, common stock investments are the safer choice. "Each has been with Berkshire for decades, and Berkshire's blood flows through their veins".

With $116 billion in cash and Treasury Bills, Berkshire thinks it will get a chance to execute some large deals.

So what could Berkshire buy?

Buffett said Berkshire functions like a savings account, so it doesn't pay dividends.

The long-time bull on USA companies and the economy issued his latest letter to Berkshire Hathaway Inc shareholders on Saturday.

"It's a way of saving money over time", he said.

Buffett also said that while Berkshire's insurance holdings would take a US$2 billion after-tax hit from losses caused by hurricanes previous year in Florida, Texas and Puerto Rico, other reinsurance companies did far worse. Book value per share, measuring assets minus liabilities, rose 23% in 2017.

One is Wells Fargo & Co, the third-largest USA bank, which was surprisingly ordered this month by the Federal Reserve to curb asset growth while it tries to rebound from scandals over how it treated customers.

Buffett has always been highly critical of the high fees charged by hedge fund operators.

Buffett also said that the Berkshire Hathaway employees' annual college NCAA tourney pool begins in a couple of weeks. That compares with $548 million gain the previous year.

Cramer, the host of " Mad Money", concluded his Buffett analysis by saying: "This is a man who taught for three hours".



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