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do not start following investment brokers and famous investors like Warren Buffet


don't start following investment brokers be smart

Many times people say that you should follow Warren Buffet and other smart investors that are famous. They also say you should follow the advice of other BROKERS ON THE TOP of the charts as well. This I do not think is smart investing though because the advantage you have is being a small little investor is precision and speed. These big brokers that run mutual fund have to worry about liquidity much more than you do, since they literally control billions of dollars.


This also goes for Warren Buffet too, he is worth billions and therefor when he needs to sell off assets that have to be big enough for him to buy and liquid enough to sell to other investors. This means that he is no longer able to make a huge returns every year from his money in things like small cap stocks. If he invested in a small billion dollar company and buys a billion worth of stock and a year later the company doubles in value and he sells it for two billion he has only made one billion IF HE COULD ACTUALLY SELL IT. Given the fact he is worth 60 billion he would be WAY BETTER OFF investing in HUGE companies and putting in say ten billion and if they go up 10% he has made as much as if you DOUBLED one billion. current ratio

why can't I mimic buffet investing in the stock market?

As you can see if you mimic him you probably WILL make a very low interest rate per year which for him is good and for you is crap. Remember 10% to him is a lot since he is worth billions. The advantage you have as a small investor though is the ability to make money in small markets that would be a waste of Buffets time and effort. You will note that Warren Buffet started out with smaller investments in the beginning as well.


What you need to look at and mimic is NT WHAT BUFFET DOES NOW, but what he did BEFORE he became very rich. Once you follow what he did that MADE him rich you will be on the road to success. If you follow what he does NOW that he is rich, you cannot expect to get huge returns. following investment brokers is the same way remember they control billions.