CW8888: Even you are the world’s greatest investor; Mr. Market no hew you during market crash!
Warren Buffett believes investors should avoid using borrowed money to outperform.
The Oracle of Omaha explained the perils of using debt and leverage in his 2017 annual letter to Berkshire Hathaway shareholders released on Saturday.
“Berkshire, itself, provides some vivid examples of how price randomness in the short term can obscure long-term growth in value. For the last 53 years, the company has built value by reinvesting its earnings and letting compound interest work its magic. Year by year, we have moved forward. Yet Berkshire shares have suffered four truly major dips,” he wrote.
The investor shared the data which revealed Berkshire Hathaway’s stock declined by a range of 37 percent to 59 percent multiple times over the last five decades …