What are Warren Buffett's Money Moves Right Now?

As an investor it can be difficult to find out who you should listen to and learn from. An idea to find the best investing strategy is to model successful investors – people who have done extraordinarily well over many years. Since 1965 Warren Buffett’s investments have increased 20% every year. Had you invested just $1 with him back then, you would’ve had $3,6 million today. Imagine the number had your investment been $100.000 - the money he asked his first partners to invest with him (in today's money that would be just south of $1 million, so definitely not a partnership that anyone could enter - hurray for the Berkshire Hathaway stock!)

My purpose of this blog and everything I do is to describe what Buffett is doing so you can learn from him and so you can be successful in your life as an investor too.

Today’s lesson is about what Warren Buffett is doing with this money these days and inspiration for you to do the same. 

Let's start with a story and an important anniversary coming up. When Warren Buffett was 11 years old (March 11th 1942), he bought his first stocks - 3 stocks of Cities Services at a total of $ 142,75. He spent all his savings buying these first stocks in a business. Since this very first investment he made 80 years ago, he has preferred to have a minimum of 80% but preferably 100% of his savings invested in equities (another word for ex. stocks).

But these days Warren isn't investing in much. It’s not that he wouldn’t love to but the companies he would like to invest in are too expensive and so is the entire stock market (you can read more about how to know if the market is overvalued here). In my investing course I teach Warren Buffett's investing strategy and know the exact stock price to pay using Buffett's methods.

That means that Warren Buffett currently has a lot of cash in savings that he would rather invest. Actually, he has $144 billion in savings that he is ready to invest! That is And over 4 times more money than he prefers to have in savings. He does not like to have cash savings.

So why not buy some stocks, you might wonder. Well Warren Buffett’s rules of investing is 1) Never lose money and rule number 2) Never forget rule one. If he bought stocks in an overvalued company – a company whose stock price exceeds the worth of the company, he would likely lose money. Because of this rule (to not lose money) he only invests in stocks that are cheap, where the business is on sale, so he can buy at a “margin of safety” (I’ve explained the concept here). Right now he can’t find stocks that meet his criteria for his long-term buy and hold strategy.

Though Buffett might have a lot more cash than he prefers right now, he has high hopes for the future.

I have endured similar cash-heavy positions from time to time in the past. These periods are never pleasant; they are also never permanent.

Warren Buffett


Most Popular This Month

Where does Warren Buffett live? Your itinerary to Omaha

An investor's artifact: the checklist. You can download it for free

5 Ways to Get Financially Literate

How Design Your Life by Setting Goals