If you are not 10 years old anymore, do you still think that wearing the same shoes as Michael Jordan, Kobe Bryant or LeBron James will instantly transform you into an NBA star? I’m sure many great players of all ages who look up to these NBA superstars are inspired by the success of these superstars, but they know that they have to work hard and make the best of what they have right now.
We’ve been writing a lot about following the trend, and we were asked a question that we were asked a ton of times:
“… What about Warren Buffet? … I guess he’s the trendsetter rather than an outlier …”
If you’ve asked a similar question about Warren Buffet, just for yourself or when you’re talking about investing, here are some key ideas to consider. Warren Buffet is a huge inspiration and iconic investment figure. Just like Michael Jordan, Kobe Bryant and LeBron James are iconic basketball figures. If you’re not yet a highly influential billionaire, you’re probably not in the same position to make the same investments as Warren Buffet right now. But when Warren Buffet started his journey, he wasn’t a billionaire either. He did not, and could not, do things the way he does today! Michael Jordan did not become Michael Jordan’s superstar by wearing Air Jordan Nike in his high school days, nor in his North Carolina Tar Heel days, nor in the early years of his NBA career.
Many of our friends and family, as well as our readers, see the end result of Warren Buffet, his success, and believe that what they know about Buffet now is enough to become a successful investor. Many don’t see that today’s Buffets and Jordans are the culmination of endless hours of intense hard work, tons of failures that translated into tons of experience, being too prepared to take advantage of opportunities and connections when they arose. At various stages in their life and career, they did things differently. They just worked hard enough and were prepared enough to know what to do at each stage.
For most investors, not just people like you and me, but professionals managing millions as well, we are in a different league than Buffet. Yes, millionaires are still considered small fish in the world we live in today. And most of us have to play a different game. Most of us with bills to pay, families to care for, and limited savings don’t have the luxury of waiting decades for an investment to grow – we don’t even have the team of top financial minds doing our secretarial work. We are also not in a position like Buffet is to deal with Goldman Sachs, the world’s most powerful investment bank, a limited-risk investment with high returns. Buffet is what traders call a “whale” in the stock market, one of the few along with countries like China and big banks like Goldman Sachs, is enough to roll back the tsunamis and make its own waves.
What can we do? We can be smart with our small size and play the best game in front of us. If you have your own style of investing or trading that is printing money for you, great! Stick with what works. But for those who are simply not sure which is the best game in front of us, we want to start with something simple: follow the trend. The trend is basically the Tsunami that Buffet or China are creating. It has so much momentum that it takes a long time to stop. Similar to a tsunami, there will be low tides where the skilled and courageous can go against the current to earn some money. But we are here to keep it simple and make it as easy as possible. We do not want to be in front of a tsunami. But if we can increase our bank account a couple of times, it is a good start to move to the next stage. A word of caution. When Buffet or other big investors are creating the Tsunamis, they won’t advertise it. Tsunamis are too fast and too strong. When you read about what Buffet has added to his portfolio, notice the word strained. Is past. The news has come out. The big wave of the Tsunami that you must ride may be over.
We suggest reading some of our other articles on the web or learning for yourself how to trade with the trend early on. Maybe one day you’ll be a whale like Warren Buffet, but even getting halfway through a millionaire isn’t that bad.
