“Rule Number One: Never Lose Money. Rule Number Two: Never Forget Rule Number One”As a result of the financial crisis of 2008, Warren Buffett lost about $23 billion personally, and his company, Berkshire Hathaway, lost its AAA credit rating. So how can he tell us not to lose money, then?
- His point is that a sensible investor has a certain mindset that includes:
- Avoid frivolous spending.
- Make sure you don’t gamble.
- Don’t make investments with a cocky attitude that you can lose money.
- Educate yourself.
It is natural for the stock market to fluctuate. Buffett stays focused on his goals no matter how good or bad the economy is, and all investors should do the same. It does not matter what the market does; this esteemed investor rarely tweaks his long-term investment strategy.