{"id":30722,"date":"2023-07-03T07:55:34","date_gmt":"2023-07-03T11:55:34","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/money-wisdom-and-life-lessons-from-billionaire-investors\/"},"modified":"2023-07-03T07:55:35","modified_gmt":"2023-07-03T11:55:35","slug":"money-wisdom-and-life-lessons-from-billionaire-investors","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=30722","title":{"rendered":"Money Wisdom And Life Lessons From Billionaire Investors"},"content":{"rendered":"<div>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\"><strong>How do you build enough wealth to reach the ranks of the Forbes 400 Richest Americans? Eight of the greatest investors of all time share strategies and life lessons that have guided them.<\/strong><\/h3>\n<p><abbr class=\"drop-cap color-accent font-accent\">F<\/abbr>or more than 105 years Forbes has been reporting on the world&#8217;s smartest business minds and greatest investors. In 1969, Forbes Magazine first profiled Warren Buffett at a time when his Omaha-based Buffett Partnership was only 12 years old, but already had a value of $100 million and a 31% compounded annual return. In the article, Buffett described the stock market as like having a \u201cmanic-depressive partner,\u201d insisting that investors not buy or sell stocks on its terms, but rather invest only when the prices were agreeable to them, based on fundamental research.<\/p>\n<p>So far in 2023, Mr. Manic-Depressive Market, as measured by the S&amp;P 500 has gained nearly 16%, after a dismal 2022 in which it fell 19%. The technology heavy Nasdaq Composite is up 31.7% in the first half of 2023, fueled largely by the excitement over artificial intelligence and companies pioneering the disruptive tech like Nvidia, Microsoft and Alphabet. The Nasdaq Composite is having its best first half since 1983. Last year it fell 33%.<\/p>\n<p>What is in store for the second half of 2023? Despite the Federal Reserve\u2019s rate hikes and its mission to cool the economy in an effort to bring down inflation, U.S. GDP is still strong, coming in at 2% for the first quarter and unemployment remains relatively low. The nation\u2019s largest banks performed well during the Fed\u2019s recent stress tests, and regional banks seem to have stabilized. But the jury is out on how increased capital requirements, coupled with the balance sheet losses hundreds of banks are sitting on, will ultimately affect the sector. Plus, there is no telling when the next bout of bad bank news fueled by social media hysteria could incite a run.<\/p>\n<p><fbs-ad position=\"top\" progressive=\"\" ad-id=\"article-0-top\"><\/fbs-ad><\/p>\n<p>Establishing portfolio positions based on reading the economic tea leaves at any given point in time is best left to professional traders. A smarter tact is taking a long-term approach, informed by those with track records of great success. Last year, Forbes introduced a new monthly investment advisory service, <strong data-ga-track=\"InternalLink:https:\/\/www.forbes.com\/newsletters\/forbes-billionaire-investor\/?utm_source=investing&amp;utm_medium=organic&amp;utm_campaign=growth_non-sub_organic_subscribe_fbi-article&amp;sh=3c55295159c6\"><em data-ga-track=\"InternalLink:https:\/\/www.forbes.com\/newsletters\/forbes-billionaire-investor\/?utm_source=investing&amp;utm_medium=organic&amp;utm_campaign=growth_non-sub_organic_subscribe_fbi-article&amp;sh=3c55295159c6\">Forbes Billionaire Investor<\/em><\/strong>, which not only tracks the favorite stocks of the world\u2019s smartest and most successful investors, but also features in-depth interviews and profiles with this elite group. As the United States celebrates its 247th birthday, Forbes has curated a selection of investment\u2013and life\u2013wisdom based on the newsletter\u2019s recent interviews with eight investment greats.<\/p>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\"><strong>David Rubenstein<\/strong><\/h2>\n<h4 class=\"subhead4-embed color-body bg-base font-accent font-size text-align\"><sup>NET WORTH: <strong>$3.1B<\/strong> | COFOUNDER AND EXECUTIVE CHAIRMAN, <strong>CARLYLE GROUP<\/strong><\/sup><\/h4>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Math And Micromanaging<\/h3>\n<p>\u201cHere\u2019s what the great [investors] have in common: They came from blue-collar, middle-class families. They\u2019re pretty well educated. They\u2019re not high school dropouts. They have a pretty good facility for math. They have enormous intellectual curiosity. They really love to read as much as they can, even if it\u2019s not about the area that they\u2019re investing in. They are sponges for information. They like to make the final decision. They don\u2019t want to delegate the decision and when they make a bad decision, they own up to it and get onto the next thing.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Advice For Novice Investors<\/h3>\n<p>\u201cThe most important thing is to read, know what you\u2019re getting into, and don\u2019t think you\u2019re a genius because you\u2019re good at making widgets. Just be realistic in your rate of return expectations. The most important thing to recognize is that the biggest mistake people make is they sell when markets are going down and they buy when the markets are going up.\u201d<\/p>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\"><strong>Warren Buffett<\/strong><\/h2>\n<h4 class=\"subhead4-embed color-body bg-base font-accent font-size text-align\"><sup>NET WORTH: <strong>$112.5 BILLION<\/strong> | CEO AND CHAIRMAN,<strong> BERKSHIRE HATHAWAY<\/strong><\/sup><\/h4>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">The Prospects And Threat Of Artificial Intelligence<\/h3>\n<p>It can do amazing things. Bill Gates brought me out the latest, maybe not the latest version, but one he thought I could handle, and it did these remarkable things, but it couldn\u2019t tell jokes. When something can do all kinds of things, I get a little bit worried because I know we won\u2019t be able to uninvent it. We did invent, for very good reason, the atom bomb in World War II but is it good for the next 200 years of the world that has been unleashed? Einstein said after the atom bomb that it changed everything in the world except how men think. I would say the same about AI. It can change everything in the world except how men think and behave, and that\u2019s a big step to take.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Opportunities<\/h3>\n<p>\u201cThe world is changing but new things don\u2019t take away the opportunities. What gives you opportunities is other people doing dumb things and I would say that in the 58 years we\u2019ve been running Berkshire, there\u2019s been a great increase in the number of people doing dumb things and they do big dumb things. The reason they do it to some extent is because they can get money from other people so much easier than when we started, so you could start 10 or 15 dumb insurance companies in the last 10 years, and you could become rich if you were adroit at it, whether the business succeeded or not.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Tribalism Vs. The United States<\/h3>\n<p>\u201cNow the problem we have, I think, is the partisanship. It seems to be this move toward tribalism, and tribalism just doesn\u2019t work as well. When it comes to tribalism, we don\u2019t even hear the other side, and tribalism can lead to mobs, but if I still had a choice of any place to be born in the world, I\u2019d want to be born in the United States and I\u2019d want to be born today. It is a better world than we\u2019ve ever had. We do need to think about different solutions in terms of how we get important problems solved. So far, it doesn\u2019t look very promising, but then I\u2019m sure that when Lincoln looked at what was going on in the Civil War, it didn\u2019t look very promising either. The challenges are huge, but I think that the U.S. is capable of doing remarkable things, and it wouldn\u2019t surprise me if we do it again.\u201d<\/p>\n<p><fbs-ad position=\"topx\" progressive=\"\" ad-id=\"article-0-topx-1\"><\/fbs-ad><\/p>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\"><strong>Ron Baron<\/strong><\/h2>\n<h4 class=\"subhead4-embed color-body bg-base font-accent font-size text-align\"><sup>NET WORTH: <strong>$4.9 BILLION<\/strong> | CHAIRMAN AND CEO, <strong>BARON FUNDS<\/strong><\/sup><\/h4>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">On Switching From Value Investing To Growth<\/h3>\n<p>\u201cWhen I first got started, it was about what a business was worth. It was based on what I thought a business was worth and then buying it at a discount to that. I bought a bunch of stocks like that, most of them worked out fine, but the ones that didn\u2019t were just terrible investments and I couldn\u2019t get out of them. So I said, that doesn\u2019t sound like a very good idea. What turned out to be a better idea was investing in great businesses with growth potential, great people running them and a competitive advantage. I focused on sales growth as opposed to earnings per share growth.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Advice For His 20-Year-Old Self<\/h3>\n<p>\u201cYou have to love what you do, really work hard and guard your reputation above everything else. By that, I mean the way you act when nobody sees what you\u2019re doing. You have to ask yourself, would I be proud? One of the people who helped me early in my career was Jay Pritzker, who told me once, \u201cRon, if you need to have an agreement in writing, you\u2019re doing business with the wrong person.\u201d You have to live and die by your word. Whatever you say you\u2019re going to do, you do. That was a really big lesson, living up to your word and being a handshake person.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Greatest Investment Triumph<\/h3>\n<p>\u201cIt would be <strong>Tesla (TSLA)<\/strong>\u2014that\u2019s the one we\u2019ve made the most from and the one I still think we\u2019re going to make the most in the future\u2026So we invested $380 million between 2014 and 2016, which has generated billions of dollars in gains for our clients over the years. I think we\u2019re going to be getting a five, six or seven times return on our investment again in the next ten years. Now we\u2019ve also been heavily investing in SpaceX.\u201d<\/p>\n<p><fbs-ad position=\"topx\" progressive=\"\" ad-id=\"article-0-topx-2\"><\/fbs-ad><\/p>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\"><strong>Sam Zell<\/strong><\/h2>\n<h4 class=\"subhead4-embed color-body bg-base font-accent font-size text-align\"><sup>NET WORTH: <strong>$5.2 BILLION<\/strong> | FOUNDER, <strong>EQUITY GROUP INVESTMENTS<\/strong><\/sup><\/h4>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">The Dollar\u2019s Supremacy<\/h3>\n<p>\u201cThe number one concern I have is the loss of the dollar as the reserve currency. I don\u2019t think anybody really understands what an incredible benefit it is to the United States, and to our standard of living, that we in effect are the reserve currency. And we can print. But like any scenario, if you take it too far, if you debase the fiat currency to the point where people lose confidence in the reserve currency, then it\u2019s going to have a pretty significant impact on the overall economic environment.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Decarbonization<\/h3>\n<p>\u201cThe Biden administration came in and has just about done everything they can to inhibit the growth of fossil fuels. They\u2019re operating under what I think is a fallacious assumption that within a relatively short period of time, like California, no more carbon fuel cars by 2035. I just don\u2019t see how there\u2019s any way that we can wean ourselves off of carbon energy within this timeframe. I don\u2019t even think it\u2019s close.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Importance Of Liquidity<\/h3>\n<p>\u201cLiquidity equals value. So we encourage all our companies to maintain high levels of liquidity. Because in the end, every period of economic stress has ended with a liquidity event or a real liquidity challenge, and how it\u2019s addressed, separates the men from the boys.\u201d<\/p>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\"><strong>Leon Cooperman<\/strong><\/h2>\n<h4 class=\"subhead4-embed color-body bg-base font-accent font-size text-align\"><sup>NET WORTH: <strong>$2.5 BILLION <\/strong>| FOUNDER, <strong>OMEGA ADVISORS<\/strong><\/sup><\/h4>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Why Value Investing<\/h3>\n<p>\u201cI have always been value oriented. I like to get more for my money than I pay. I\u2019ve observed that technology is a double-edged sword. Somebody\u2019s innovation is another\u2019s obsolescence, so I\u2019ve never understood paying high multiples for businesses when they could have a short run life. Look at Meta as a perfect example. TikTok seems to be taking their market away.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Advice For 20-Somethings<\/h3>\n<p>\u201cThe most important advice I give the youngsters is that the only way to be successful is to do what you love and love what you do. I work 80-hour workweeks, but I never looked at it as work. I enjoyed what I did.\u201d<\/p>\n<p><fbs-ad position=\"topx\" progressive=\"\" ad-id=\"article-0-topx-3\"><\/fbs-ad><\/p>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\"><strong>Mario Gabelli<\/strong><\/h2>\n<h4 class=\"subhead4-embed color-body bg-base font-accent font-size text-align\"><sup>NET WORTH: <strong>$1.6 BILLION <\/strong>|<strong> <\/strong>CEO, <strong>GAMCO INVESTORS<\/strong><\/sup><\/h4>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">A Hands-On Approach To Investment Research<\/h3>\n<p>\u201cYou basically take an annual report and you drill into it. So you look at that. But more importantly, because you follow an industry, you go in and read all the trade magazines, you go to all the conferences, you go see five, six companies\u2026you get a feedback mechanism. For example, one time there was a company, Snap-on Tools, they then created Safety Clean. So I\u2019m saying to myself, listen, I go to a local gas station guy and I say, what are you buying? We would go bottoms up in an industry.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Advice For 20-Somethings<\/h3>\n<p>\u201cBasically for a new investor, if you\u2019re 20 years old and you grew up on <em>Fortnite<\/em>, you like to have short-term gains, <strong>think about the long term<\/strong>. That is the notion of compounding of value over an extended period of time. I have a grid that I use when I give college talks about how to become a billionaire. And that is to have one less [coffee], and take that money for that and invest it. So one less per day, and you\u2019re putting $35 in a week, and you grow it at 4, 6, 8, 10% over the next 40 years, where are you going to be? So if you really want to help yourself, one less beer or one less White Claw.\u201d<\/p>\n<p><fbs-ad position=\"topx\" progressive=\"\" ad-id=\"article-0-topx-4\"><\/fbs-ad><\/p>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\"><strong>Glenn Dubin<\/strong><\/h2>\n<h4 class=\"subhead4-embed color-body bg-base font-accent font-size text-align\"><sup>NET WORTH: <strong>$2.8 BILLION<\/strong> | FOUNDER, <strong>DUBIN &amp; CO.<\/strong><\/sup><\/h4>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Ride Trends, Bet On The Best<\/h3>\n<p>\u201cI\u2019m looking for a strategy, a region, an investment class, where the wind is at your back. That could be a new market, that could be a new product, that could be a secular change in the investment cycle. Then it\u2019s going out and identifying talent, whether it be a portfolio manager, a trader, an analyst or a quantitative analyst, obviously depending upon the strategy and the business that you\u2019re building. If you put those two things together\u2014something where you have the wind at your back and you identify great talent, the probability of success is raised meaningfully.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">The Importance Of Experience<\/h3>\n<p>\u201cA lot of people that are managing money today have done so only in a very favorable environment for risk assets, a low interest rate environment. We\u2019re now in a tightening cycle. We\u2019ve raised interest rates from effectively zero to 5% in a relatively short period of time, and it\u2019s creating a lot of cracks in the system. If you don\u2019t have the experience of managing through a rising interest rate cycle, you\u2019re at a real disadvantage.\u201d<\/p>\n<p><fbs-ad position=\"topx\" progressive=\"\" ad-id=\"article-0-topx-5\"><\/fbs-ad><\/p>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\"><strong>Thomas James<\/strong><\/h2>\n<h4 class=\"subhead4-embed color-body bg-base font-accent font-size text-align\"><sup>NET WORTH: <strong>$2.3 BILLION<\/strong> | CHAIRMAN EMERITUS, <strong>RAYMOND JAMES FINANCIAL<\/strong><\/sup><\/h4>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Seek Ticket Takers<\/h3>\n<p>\u201cI want to be a ticket taker at the toll bridge and get more money every year as more and more people go across the bridge. That\u2019s the kind of company [stock] I want to Own. Right now I\u2019m buying Verizon (VZ). It has a good yield [7%] and it\u2019s priced at the low end of its range over the last five years [ P\/E ratio of 7]. I\u2019m not worried about it going broke.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Just Say No To Market Timing<\/h3>\n<p>\u201cIf you look at almost any ten-year period, stocks go up. People are lousy at determining bottoms and tops. I like to use dollar-cost averaging and putting money into the market over a number of years. If you walk into my office with a lot of money, I say if you want to invest it over the next two years, we\u2019ll do it quarterly eight times. You can\u2019t beat the market long term.\u201d<\/p>\n<h3 class=\"subhead3-embed color-body bg-base font-accent font-size text-align\">Steer Clear Of Hot Tips<\/h3>\n<p>\u201cAvoid that guy who comes to you with a stock idea because it\u2019s acting right, yet you can\u2019t figure out what\u2019s really going on at the company and it sounds like so much bull. Back in the bear market of 1974, I went to the best business school in history called the school of hard knocks. If you want to have your arrogance knocked out of your head, just go through a period like that. You have to take risk, but there are times when you do it and there are times when you don\u2019t do it. Every retail investor doesn\u2019t want to invest at the bottom of the market, but I want to invest at the bottom of the market.\u201d<\/p>\n<p><fbs-ad position=\"topx\" progressive=\"\" ad-id=\"article-0-topx-6\"><\/fbs-ad><\/p>\n<h4 class=\"subhead4-embed color-body bg-base font-accent font-size text-align\"><\/h4>\n<h4 class=\"subhead4-embed color-body bg-base font-accent font-size text-align\"><strong>MORE FROM FORBES<\/strong><\/h4>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.forbes.com\/sites\/schifrin\/2023\/07\/03\/money-wisdom-and-life-lessons-from-billionaire-investors\/\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>How do you build enough wealth to reach the ranks of the Forbes 400 Richest Americans? Eight of the greatest investors of all time share strategies and life lessons that have guided them. For more than 105 years Forbes has been reporting on the world&#8217;s smartest business minds and greatest investors. In 1969, Forbes Magazine [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":30723,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[239],"tags":[83],"class_list":["post-30722","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing","tag-featured"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Money Wisdom And Life Lessons From Billionaire Investors | iFintechWorld<\/title>\n<meta name=\"description\" content=\"How do you build enough wealth to reach the ranks of the Forbes 400 Richest Americans? 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