To predict the short-term movement of stocks, to try to flip stocks like high-frequency traders do, and lack of attention to trading commissions and fees are three most common mistakes of investors in the stock market. It is a statement of one of the famous investors in the world Warren Buffett, the USA Today reported.
According to the Oracle of Omaha (that is how financial journalists often call Buffett), investments in stocks should be long-term and there is no need to watch weekly, monthly, or even annual changes. “Doing decently well in stocks is "very, very easy," emphasized the investor, who managed to make a fortune of $72 billion. He added that the American businesses and the U.S. as a whole country are doing well and will go well, so the shares of local companies will rise in price in the long-term period.
Buffett occupies the second place among the richest Americans. In an interview to USA Today, he compared the proper investment strategy with the American football. According to him, trading on the stock exchange, you should avoid costly mistakes that worsen the balance of the investment portfolio. It is similar to how it goes at a football match. A team should not lose the ball and let it go to the opponent team, and should follow the rules.
Buffett has invested through his company Berkshire Hathaway for decades. It owns many companies such as Geico, Lubrizol, NetJets, half of Heinz’s stock, shares in American Express, Coca-Cola, Wells Fargo, IBM, Mars and many other companies. The annual growth of the fund assets value has totaled almost 20 percent during 48 years (the S&P 500 index increase, for example, amounted to 9.4 percent).
