LESSONS TO LEARN FROM BERKSHIRE HATHAWAY'S AND WARREN BUFFET'S LATEST SHAREHOLDER'S MEETING 2020.

Important Investing Knowledge we all can learn from Warren Buffet's Berkshire Hathaway's latest Annual Shareholder's General Meeting as an Investor.

Warren Buffet at the latest shareholder's meeting.

Whenever we talk about investing, Warren Buffet comes to our mind. He is the CEO of Berkshire Hathaway, a company that recently held its Annual Shareholder's Meeting. In this meeting, they disclosed the considerable amount of cash the company holds, where the company has invested and what are the stocks they sold. Every Investor is curious to know that what is the most successful investor doing at this time and what are his insights. So after precise analyses of what Warren Buffet said and figures his Company disclosed, there are many things we all should learn as an Investor. Let's discuss them in detail and understand how we should plan our Investments in difficult situations like this.

1. Book Losses if you have to and exit at the Right Time.

Cut your losses and exit at the right time.

This is a very difficult situation for everyone. All businesses are suffering huge losses because of the lockdown situation, Airline Sector is the most affected sector as no flights are taking off and airlines have to incur huge maintenance costs because of this, all the investors who invested in this sector are suffering huge monetary losses. Berkshire Hathaway, Warren Buffet's company recently made known that it held about a 9-11% stake in many airline businesses in the U.S., as he was very confident in this sector and its growth potential. But in the recent meet, he said his company had sold all the stocks he had in this sector, for which he and his company had to suffer huge losses. The learning we get from this is we shouldn't get linked to any company or any investment emotionally and exit at the right time even if we suffer a loss. When you feel your company or your Investment is not going to perform in the coming time, that is the right moment to exit and minimize your losses.

2. Invest in the Index and be Patient.

Index Funds are the best for naive Investor's

Investing is a broad concept, which needs great analytical skills, very active participation in the market and various other additional skills to identify good businesses and stocks, which is difficult for everyone to possess. So, the second learning covered in the speech of Warren Buffet is the best investment strategy for an investor. The finest investment strategy for a naive investor who doesn't invest very actively is to invest in an Index. If you believe in the growth story of a country, that is the best option because the equity market always recovers over time. So if you are not an active investor, you should invest in Index Funds which tracks the Index of that particular Country, like NIFTY50 and SENSEX in India.

3. Always keep an Emergency Fund.

Always have an emergency fund to mitigate your risks

The Amount of Investment done by Warren Buffet in the recent quarter is around $1.8 billion, while the amount sold is $6.8 billion. When he was asked about his Cash Reserves then the amount disclosed was $137 billion. He says that, he keeps this as a way to mitigate his risks in case the situation worsens. We all can take a lesson here that one should always keep an Emergency Fund with them and not Invest all together in his business or in the stock market at once, you never know what will happen in the future and at that time this Emergency Fund can help you to mitigate your risks.

4. Conclusion.

This article/blog was the analysis of the speech given by World's most successful investor Mr. Warren Buffet in the latest annual general meeting of his Parent Company Berkshire Hathaway's, which offers valuable teachings for Investors, that you should accept your mistake, if you invested in the wrong place or if it was in a good place and because of the current scenario it has become wrong one should exit at the right time. Secondly, the best investment strategy is to invest in an index fund instead of going to an investment advisor, which increases the chances of making money in the longer horizon and third and the most important one is that the Emergency Fund is very important to mitigate your risks in the future and everyone should keep an emergency fund with them. So with this learning I hope you invest well in the coming time, you will make good returns and with that good return, you will become a good and Intelligent Investor.