As investors we’ve seen our fair share of bull markets and bear markets. And we are confident we’ll continue to see them in the future. The challenge isn’t to discover when they are going to happen and use them to get rich quick, but rather, to invest in sound assets that will grow over time, despite what the market is doing.
Look at the returns of the S&P 500 for the past 50 years and you’ll see countless peaks and just as many valleys. The stock market will rise and fall. The most difficult to do as an investor is stick to your gut when the market says your gut is wrong. But as Investment Advisor John Train says, “For the investor who knows what he is doing, volatility creates opportunity.”
“So, my friend like any other good student, at SAMI we work hard every day to strengthen our intellectual framework to buy and hold only excellent businesses, and ignore the market to stay away from speculation. Lastly, our 23 years of experience give us the strength to keep our emotions at distance.
Here are two sayings from our heroes Warren Buffett and Charlie Munger to conclude our investment mantra:
“Your goal as an investor should simply be to purchase, at a rational price, a part interest in an easily-understandable business whose earnings are virtually certain to be materially higher five, ten and twenty years from now. Over time, you will find only a few companies that meet these standards – so when you see one that qualifies, you should buy a meaningful amount of stock. You must also resist the temptation to stray from your guidelines: if you aren’t willing to own a stock for ten years, don’t even think about owning it for ten minutes. Put together a portfolio of companies whose aggregate earnings march upward over the years, and so also will the portfolio’s market value.” – Warren Buffet
• “It is not given to human beings to have such talent that they can just know everything about everything all the time. But it is given to human beings who work hard at it – who look and sift the world for a mispriced bet – that they can occasionally find one. And the wise ones bet heavily when the world offers them that opportunity. They bet big when they have odds. And the rest of the time, they don’t. It’s just that simple.” – Charlie Munger