Warren Buffett

Many stock market investors look up to Warren Buffet as their “guru”, but if you listen to him closely, he’s basically telling you not to invest in stocks.

Warren Buffett’s rule #1 of investing is “Don’t Lose Money.”

Rule #2 is “Don’t forget rule #1.”

Retail Stocks Don’t Qualify

What he means by that is: don’t invest in anything that can go down in value.

By that definition, almost all stocks are ruled out. By contrast, Warren Buffett wants you to buy assets at wholesale, not at retail prices. That means picking up property or companies at 50 cents on the dollar.

When you buy stocks online, you are, by definition, paying market value for the stocks. The only way to get a company at wholesale is to buy the whole thing like Warren Buffett.

Wholesale Real Estate

Since most people can’t afford an entire company, the next best thing is a piece of real estate.

We buy $100k properties for $50k and fix them up. We are never in to a property for more than 70% of the after repair value. That way, we are protected against a downturn in the market.

Don’t Lose Money!

The hardest thing in investing is recovering from a loss. It takes a 100% gain to recover from a 50% loss. So don’t lose money!