Warren Buffett’s Good Advice Applied to 3 ETFs
Despite the garbled cacophony of market punditry that washes in and out of the news media like the tide, there’s actually a straightforward way to achieve satisfactory investment results. This, at least, is the argument offered by Berkshire Hathaway (NYSE:BRKA)(NYSE:BRKB) Chair and CEO Warren Buffett, who is perhaps chief among those wise and savvy men and women who make up the pantheon of legendary investors.
“You don’t need to be an expert in order to achieve satisfactory investment returns,” Buffett wrote in his 2013 letter to shareholders. You don’t even need to spend your time seeking obscure information advantages in the archives of the Securities and Exchange Commission or looking for enlightenment in academic financial literature (unless this kind of nose-to-the-grindstone pass time is your cup of tea, in which case, sláinte!)
The basis for Buffett’s argument is this: “In aggregate, American business has done wonderfully over time and will continue to do so (though, most assuredly, in unpredictable fits and starts.) If this is true (and why shouldn’t it be), then the “goal of the non-professional should not be to pick winners — neither he nor his ‘helpers’ can do that — but should rather be to own a cross-section of businesses that in aggregate are bound to do well.” After all, what could be a more satisfactory investment result than a replication of the growth of the market at large?