Image source: The Motley Fool
Warren Buffett buys stocks again. After a long struggle to see attractive investment opportunities in the stock market, Berkshire Hathaway The CEO has recently made significant investments in Chevron, HP, Occidental Petroleum, Activision Blizzardand Apple.
Recently, stock prices have been falling amid fears of inflation, rising interest rates and a shortage of supply chains. It is also difficult to understand when moods will begin to change.
The bear market continues, but Buffett clearly believes that prices have reached a level at which an investor can make a significant profit. So should I follow Buffett’s example and invest in stocks?
I’m buying now
To be clear at the outset, I have no idea whether stock prices will continue to fall or whether they may return quickly. If I buy company shares today, there is a risk that they may be sold next week for less than I paid for them.
But Buffett also has no idea where stock prices can go. His investment in Verizon – which is currently trading below the price at which Berkshire Hathaway bought the stock – This is a good example.
For Buffett as an investor, what matters is not whether or not stock prices have been reached the lowest levels. Rather, it is important whether they have reached that level low enough be attractive in terms of investment.
Buffett’s activities in the stock market clearly show me that he believes there are at least some stocks that have reached a low enough level to justify the investment. This tells me that I also need to look for opportunities.
I think it should be noted that Buffett does not invest in companies across the field. Most likely, he is quite selective in his investments, choosing to invest significant sums of money in specific individual stocks.
As for my own portfolio, I try to follow Buffett’s example. As a result, I am looking to buy shares of companies where prices have now fallen to attractive territory.
The most obvious example of this for me Right movement. When the stock traded around 800 pensions, I didn’t see a return option for the investor, but at 530 pensions I am happy to buy the shares.
I also watch Legal and general. With company stocks trading at 230 pence, I find them much more attractive than I am when they cost above 300 pence.
Overall, I think I should buy stocks in the current market. I think that following the example of Warren Buffett and looking for selective use of specific opportunities, I can invest when stock prices fall all over.