Warren Buffett uses 3%?

[0007]

According to CNN Warren has just lost $2 billion in two days http://money.cnn.com/2014/10/21/investing/warren-buffett-berkshire-lost-2-billion/index.html and according to this http://www.businessinsider.com/mindblowing-facts-warren-buffett-2014-8?op=1 he is worth $63 billion.


Now that looks like 3% to me, so is it only part urban myth that highly capitalised traders risk just a fraction of a percent? Or is Warren under an investor's umbrella a completely different kind of animal? Did he have a stop loss on Tesco?

 

[donaldduke]

According to CNN Warren has just lost $2 billion in two days http://money.cnn.com/2014/10/21/investing/warren-buffett-berkshire-lost-2-billion/index.html and according to this http://www.businessinsider.com/mindblowing-facts-warren-buffett-2014-8?op=1 he is worth $63 billion.


Now that looks like 3% to me, so is it only part urban myth that highly capitalised traders risk just a fraction of a percent? Or is Warren under an investor's umbrella a completely different kind of animal? Did he have a stop loss on Tesco?

You might be confusing Buffets net worth with Berkshire Hathaway total assets.
A quick google reveals berkshire hathaway has 200billion in equity.
So 2 billion lost is 1%.

Everyone takes a big hit in the market every now and then, even Mr Buffet.

 

[verbum4it]

Warrent Buffet is a most popular trader I know, and later I decide to be a trader because of "his motivation".

 

[iMusingKiMi]

I believe it is less than 1% to me. Average of monthly growth for Warren Buffet is 2.5%, if a single trade loss him 3%, he is not Warren Buffet.

 

[Pat Riley]

It's always worth fading Buffet and Blackrock when they make a move. On the basis that market sentiment will overshoot in response.

 

[Pat Riley]

Can't remember the thread, but less than a month back (I think) I said Tesco was (and is) a buy. Between the two of em they dumped approximately 8% of the stock, there has been nothing but relentless bad news and incrimination and implications of wrong-doing and two of the big four acc-consults being investigated. Ya couldn't get a better doomsday scenario. And look what's happened, in all that time no more than a 20p slide (less than 10% in a month of bad news).

Compare that with me other recent mention of BBY which has lost over 5% in the few days since I mentioned it and that with no news to relatively positive news. Ya need to be thinking, if price isn't moving in concert with the news or for no apparent reason, then someone somewhere has a plan.

 

[tar]

A DD of 3% hardly means that he risks that much / trade ... what about his other holdings ...options ... etc .

 

[gringots]

I could be wrong but I doubt Warren Buffet does any intraday trading. I wouldn't classify him as a trader especially not a day trader. The low percentage risk per trade rule is not something you apply to investing. Investing is more about balance. The kind of "trades" Warren Buffet does are deeply researched and strategic.

 

[Mr. Charts]

The man is a long term investor who analyses fundamentals and macro economic factors and buys only if he "likes" the company. I was going to say trends rather than factors, but decided someone here would then ask whether he used breaches of trend lines or moving average cross overs and at what settings..........

The nearest he gets to trading (apart from option positions) is getting rid of his seven year old Caddy for a new one and still lives in the house he bought in 1958 for $31,500.

 

[NVP]

According to CNN Warren has just lost $2 billion in two days http://money.cnn.com/2014/10/21/investing/warren-buffett-berkshire-lost-2-billion/index.html and according to this http://www.businessinsider.com/mindblowing-facts-warren-buffett-2014-8?op=1 he is worth $63 billion.


Now that looks like 3% to me, so is it only part urban myth that highly capitalised traders risk just a fraction of a percent? Or is Warren under an investor's umbrella a completely different kind of animal? Did he have a stop loss on Tesco?

he must be devastated..............he'll be shopping at Aldi next with that little left

N

 

[NVP]

The man is a long term investor who analyses fundamentals and macro economic factors and buys only if he "likes" the company. I was going to say trends rather than factors, but decided someone here would then ask whether he used breaches of trend lines or moving average cross overs and at what settings..........

The nearest he gets to trading (apart from option positions) is getting rid of his seven year old Caddy for a new one and still lives in the house he bought in 1958 for $31,500.

he also utilises his contacts and leverage to make sure everything he buys is at drop dead cheap prices with with minimum downside

ask Goldman Sachs

N

 

[Pat Riley]

His contacts also use him to leverage front runs.

 

[Vinayak1000]

I think Buffett might have used the pullback in the stocks to buy more at a cheaper rate. Buffett has a buy and hold strategy that best works over the long term. Currently, the legendary investor has lost $2.4 billion in paper value in the past week due to the decline of two stocks: Coca-Cola and IBM. Coke shares dropped 6% and Big Blue fell about 11% over the week.
Buffett always has his eyes on the long term prize and he is not likely to be checking the market averages every day. His work is reassessing and rebalancing the risk in his portfolio. Coca-Cola is now focusing on cost-cutting and this is seen as a great and easy way to maximize returns over the long term.
Meanwhile, IBM is attempting to reinvent itself as a nimble, service-first company. It is divesting essentially all of its hardware businesses and investing that cash into cloud technology, Watson-like big data solutions, and other next-generation technologies.