MANILA - Investing in the stock market requires patience and going against the tide, according to the daughter-in-law of self-made billionaire Warren Buffett, who shared what she learned from one one of the world's richest men in a new book.
Mary Buffett, who was in Manila recently to launch "The New Buffettology" said "cash is always king" and potential investors should start by saving up.
"Make it a habit to always put away a little cash for an emergency or for a buying opportunity, or buy stock in a lower price than it’s worth. So whether its just keeping it on your pocket, putting it in a jar, believe it or not it adds up," Mary Buffett told ABS-CBN News.
Financial literacy is a also a must, she said, adding, "at least know what the terms are and understand what the risks are."
Avoiding debt is another fool-proof way to grow money. The key is to avoid it or get out of it before investing, she said.
"No matter what investment you make, if you’re paying 18 to 20 percent on money, you’re never going to be making money," Buffett said.
Warren Buffett is worth nearly $80 billion today from an initial $6,000 just by investing in the stock market.
The author said her father-in-law's secret is in value investing or “investing when everyone is fearful and be fearful when everyone is greedy.”
Investors should also study the company, its performance for the last 10 years, its debts and its competitive advantage before buying shares, she said.