Warren Buffett’s Berkshire Hathaway company. If you’d invested in Berkshire in 1965, you would have made 1,900 times your money by now.
Berkshire’s stock investments comprise one of the best-known portfolios around. But its huge success has to do with more than just good timing. Unlike many investors who sweat over the precise timing of when to jump into a stock, Berkshire focuses on finding the right companies at the right price. The timing takes care of itself.
Look at the huge gains Berkshire made in so many companies (American Express and Moody’s are two that made long, steep climbs while they were part of the Berkshire portfolio) and you’ll instantly realize that it doesn’t really matter that Berkshire could have done even better had it bought a particular stock two months earlier or two months later.
You usually don’t have to wait for the stock to bottom out – or to bottom out and begin to turn around – as long as you like the company’s fundamentals, management, and growth plan.
But there’s one big exception to this rule. When a stock has taken a monumental dive – losing...