Buffett advocates that investors hold a "concentrated stock portfolio". At any time you should own a very small number of stocks, say six at most, and you should know everything there is to know about these stocks. In total, in a lifetime of investing, you should buy and sell no more than twenty times.
Buffett says: "An investor should act as though he had a lifetime decision card with just twenty punches on it. With every investment decision his card is punched, and he has one fewer available for the rest of his life." In a lifetime of investing this might result in, for example:
twenty stock purchases and no sales
Warren Buffett rightly extols the virtues of patience in investing - he says that he read annual reports from Anheuser-Busch Inc. for 25 years before buying their stock. He likens his patience in buying stocks to the patience of the baseball player who waits for the perfect pitch before swinging. We would caution beginning investors to bear in mind, however, that it takes a lot of practice before a baseball player consistently hits home runs from perfect pitches
Buffett says: "An investor should act as though he had a lifetime decision card with just twenty punches on it. With every investment decision his card is punched, and he has one fewer available for the rest of his life." In a lifetime of investing this might result in, for example:
twenty stock purchases and no sales
Warren Buffett rightly extols the virtues of patience in investing - he says that he read annual reports from Anheuser-Busch Inc. for 25 years before buying their stock. He likens his patience in buying stocks to the patience of the baseball player who waits for the perfect pitch before swinging. We would caution beginning investors to bear in mind, however, that it takes a lot of practice before a baseball player consistently hits home runs from perfect pitches
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