Warren Buffett's Berkshire Hathaway bought 75 million more Apple shares in the first quarter of 2018. Nicholas KAMM / AFP
Warren Buffett's Berkshire Hathaway bought 75 million more Apple shares in the first quarter of 2018. Nicholas KAMM / AFP

Get rich and retire early by investing like Warren Buffett



Every investor dreams of being the next Warren Buffett, the self-made US billionaire who bought his first stock age 11 and is now worth more than $93.4 billion, according to Bloomberg.

Mr Buffett is the most famous investor in the world and the third-richest person on the planet, but he is admired for more than his money.

The so-called “Oracle of Omaha” is renowned for his folksy words of wisdom, which have made him a cult figure to many. The 87-year-old is also a generous philanthropist, giving away more than $27bn in the past decade.

His investment vehicle Berkshire Hathaway has grown at an annual rate of just over 20 per cent since 1964, more than double the average annual return of 9.7 per cent on the S&P 500 index of top US stocks.

If you had invested $10,000 in the company in 1964 you would now be worth more than $240 million, multimedia financial-services company The Motley Fool calculates.

Mr Buffett may have started young but don't despair, he made 99 per cent of his wealth after his 50th birthday. The following 10 gems could help make you richer, and potentially save you a lot of money as well.

1 Rule No 1: never lose money. Rule No 2: never forget rule No 1

Steven Downey, a chartered financial analyst candidate at Holborn Assets in Dubai, says this is key to Mr Buffett’s down-to-earth approach. “Everyone dreams of doubling their money overnight but most successful investors built their wealth over a long time through shrewd investing and minimising large losses.”

Early losses can easily derail your long-term plans, Mr Downey says. “Losing, say, Dh10,000 hurts far more than earning Dh10,000 feels good, and this can make it hard to stick to your investment plan.”

Big losses are also hard to recover. “If your portfolio falls 50 per cent, you have to generate a 100 per cent return simply to get back where you were. If you lose 80 per cent, that rises to 400 per cent.”

You cannot do much about a stock market crash aside from be patient and wait for share prices to recover, but you can avoid taking undue risks, say, by going all in on one company or cryptocurrency, Mr Downey says. “Invest for the long term, stay diversified, manage risk and do not get greedy.”

And never forget it.

_______________

Read more:

_______________

2 If you buy things you don’t need, you will soon sell things you need

Mr Buffett is renowned for his modest and frugal living. Despite his vast wealth, he still lives in the same five-bedroom home he bought in Omaha, Nebraska in 1956, for $31,500. 

Mr Downey says there is a lesson here for UAE expatriates, who can get carried away with their tax-free salaries. “It is easy to be seduced into a lavish and debt-laden lifestyle, as you go all out for that new Mercedes or Rolex watch. By all means enjoy yourself but also develop a budget, build a financial cushion in case something goes wrong and invest every month for your long-term future.”

If you live for today and slap the cost on a credit card, tomorrow could be tough.“You may get torn to pieces by the interest, and find yourself in deep debt and unbearable stress. That is not a winning strategy.”

3 Risk comes from not knowing what you're doing

Too many investors pick up a ragbag of stocks and funds that took their fancy at some time or another, without really knowing why.

Others fall prey to commission-hungry independent financial advisers who prey on expatriates, selling expensive and inflexible 25-year offshore investment bonds that swallow most of their money. Those are the type of mistakes you make when you don't know what you are doing.

Steve Cronin, the founder of non-profit UAE investment community Wise, says amateur investors should keep it simple by investing in an exchange traded funds (ETFs).

ETFs passively track a vast spread of global indices with rock bottom charges. Over the longer run they will beat three quarters of active fund managers, and you will hand over far less in fees.

Mr Cronin suggests starting with a global fund such as the Vanguard FTSE All-World UCITS ETF. “This gives you huge diversification with nearly 3,000 stocks across 47 countries, for an annual fee of just 0.25 per cent a year.”

Shares will always carry a degree of risk, but this way you know what you are doing.

Be fearful when others are greedy and greedy only when others are fearful

This is the most famous Buffett quote of all and with good reason, says Tuan Phan, a board member of Common Sense Personal Finance and Investing, a non-profit community of UAE investment enthusiasts. "Greed and fear are the two dominant investor emotions. If left unchecked, they tempt us to do things that may damage our long-term wealth."

Too many investors follow the herd, buying stocks when everybody else is buying, selling when everybody sells.

Mr Phan says a good example is the market crash during the financial crisis. “Those who panicked and sold banked massive losses while those greedily buying stocks at depressed prices can now look forward to an early retirement.”

Keep your emotions in check. Avoid getting over excited on the way up, or too panic-stricken on the way down.

5 Our favourite holding period is forever

There is a big difference between speculation and investing, Mr Phan says. “Investing involves buying an asset for a share of future profits, speculating involves buying an asset in hope of selling it for a higher price to someone else.”

Wealth is generated from compound growth and interest over time, rather than trying to time the market, he adds. “You want to be holding a productive asset such as a dividend stock for as long as you possibly can.”

Mr Phan says most ordinary investors lack the time, knowledge or skill to successfully pick individual stocks and shares as Mr Buffett does. “For them a globally diversified ETF is the best option. Buy and hold for years, preferably decades, reinvest your dividends, avoid panic selling if markets crash and finally, retire early.”

In investing, it is not necessary to do extraordinary things to get extraordinary results

Devesh Mamtani, the head of investments and advisory (financial markets) at Century Financial Brokers in Dubai, says investing should be as boring as watching paint dry, so avoid chasing the latest fad. “It isn’t easy, especially today, when you hear stories of speculators tripling their money on the latest cryptocurrency.”

Investing in a portfolio of low-cost ETFs may be boring but should prove far more rewarding in the longer run.

Buying a hot stock tip from a friend or colleague is exciting, until your money goes down the drain. “Whenever you get tempted ask yourself this: ‘Is your colleague smarter that Warren Buffett?’ That should give you the answer.”

7 Only when the tide goes out do you discover who's been swimming naked

There are times when making money from investing seems like the easiest thing in the world, for example, during the dot.com bubble of the late 1990s, or the property boom before the financial crisis.

Mr Mamtani says even poor quality assets can make money at these times. “It takes a downturn to distinguish between the good and the lucky.”

It is the same with your portfolio. “Almost anybody can make money in a bull market, it is only when the market turns that you see its true resilience.”

You need to ensure your investments are properly balanced, Mr Mamtani says. "Are you willing to live with lower returns to reduce volatility? Could you manage your debts if your income drops? These are the questions you should ask when the tide is still rising, afterwards it may be too late."

8 Beware the investment activity that produces applause, the great moves are usually greeted by yawns

Investors need to ignore everyday swings in stock markets and other assets, and the media hubbub surrounding them, says Gordon Robertson, the director of the Me Group of businesses in Dubai. “Also tune out financial advisers hyping the latest hot investment product or mutual fund. It is all short-term noise.”

Instead of buying the best performing asset class, such as shares, bonds, cash and property, Mr Robertson suggests buying them all in equal portions.

“Then once a year, reinvest the profits from your best performers into the weakest, to return your portfolio to its original balance. ETFs let you do this cheaply.”

Markets are cyclical, and last year’s winners often become this year’s losers, and vice versa.

Mr Robertson’s figures show that somebody who invested $100,000 in 1996 and repeatedly reinvested their gains in last year’s best performing asset would have just $229,183 after 20 years. “If they had rebalanced their portfolio by investing in the weakest they would have $376,000 instead.”

This approach may induce yawns at first, the applause comes much later.

9 Forecasts may tell you a great deal about the forecaster, they tell you nothing about the future

Nobody can predict the future, not even Mr Buffett.

Tom Anderson, a chartered wealth manager at Killik & Co, who has clients in Dubai, says Mr Buffett prefers “value investing”, which involves examining the intrinsic value of a company by poring over its financial documents and statements, rather than making a big calls on market movements.

Then he buys and holds, ideally forever. It is time in the market that counts, rather than timing the market.

That way you can forget what the forecasters are saying, and let the future take care of itself.

10 Remember that the stock market is a manic depressive

Mr Anderson says if anything, Mr Buffett is being kind, as the stock market is punishingly bi-polar. “It can demonstrate the depths of despair and unbounded optimism in a single trading session, driven by panic and greed.”

Mr Buffett likes companies that have delivered a positive return on equity for many years, have relatively low debt, strong profit margins, unique products and, ideally, shares temporarily trading at a discount. 

“This enables him to shield his investors from the mood swings of the wider market.”

Stock markets may be manic in the short run, but in the longer run history shows they beat almost every other asset class. That is what made Mr Buffett so rich.

UPI facts

More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions

How to avoid crypto fraud
  • Use unique usernames and passwords while enabling multi-factor authentication.
  • Use an offline private key, a physical device that requires manual activation, whenever you access your wallet.
  • Avoid suspicious social media ads promoting fraudulent schemes.
  • Only invest in crypto projects that you fully understand.
  • Critically assess whether a project’s promises or returns seem too good to be true.
  • Only use reputable platforms that have a track record of strong regulatory compliance.
  • Store funds in hardware wallets as opposed to online exchanges.
How to protect yourself when air quality drops

Install an air filter in your home.

Close your windows and turn on the AC.

Shower or bath after being outside.

Wear a face mask.

Stay indoors when conditions are particularly poor.

If driving, turn your engine off when stationary.

The Sand Castle

Director: Matty Brown

Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea

Rating: 2.5/5

The Greatest Royal Rumble card as it stands

50-man Royal Rumble - names entered so far include Braun Strowman, Daniel Bryan, Kurt Angle, Big Show, Kane, Chris Jericho, The New Day and Elias

Universal Championship Brock Lesnar (champion) v Roman Reigns in a steel cage match

WWE World Heavyweight Championship AJ Styles (champion) v Shinsuke Nakamura

Intercontinental Championship Seth Rollins (champion) v The Miz v Finn Balor v Samoa Joe

United States Championship Jeff Hardy (champion) v Jinder Mahal

SmackDown Tag Team Championship The Bludgeon Brothers (champions) v The Usos

Raw Tag Team Championship (currently vacant) Cesaro and Sheamus v Matt Hardy and Bray Wyatt

Casket match The Undertaker v Chris Jericho

Singles match John Cena v Triple H

Cruiserweight Championship Cedric Alexander v tba

 

UAE currency: the story behind the money in your pockets
Most%20polluted%20cities%20in%20the%20Middle%20East
%3Cp%3E1.%20Baghdad%2C%20Iraq%3Cbr%3E2.%20Manama%2C%20Bahrain%3Cbr%3E3.%20Dhahran%2C%20Saudi%20Arabia%3Cbr%3E4.%20Kuwait%20City%2C%20Kuwait%3Cbr%3E5.%20Ras%20Al%20Khaimah%2C%20UAE%3Cbr%3E6.%20Ash%20Shihaniyah%2C%20Qatar%3Cbr%3E7.%20Abu%20Dhabi%2C%20UAE%3Cbr%3E8.%20Cairo%2C%20Egypt%3Cbr%3E9.%20Riyadh%2C%20Saudi%20Arabia%3Cbr%3E10.%20Dubai%2C%20UAE%3C%2Fp%3E%0A%3Cp%3E%3Cem%3ESource%3A%202022%20World%20Air%20Quality%20Report%3C%2Fem%3E%3C%2Fp%3E%0A
MOST%20POLLUTED%20COUNTRIES%20IN%20THE%20WORLD
%3Cp%3E1.%20Chad%3Cbr%3E2.%20Iraq%3Cbr%3E3.%20Pakistan%3Cbr%3E4.%20Bahrain%3Cbr%3E5.%20Bangladesh%3Cbr%3E6.%20Burkina%20Faso%3Cbr%3E7.%20Kuwait%3Cbr%3E8.%20India%3Cbr%3E9.%20Egypt%3Cbr%3E10.%20Tajikistan%3Cbr%3E%3Cbr%3E%3Cem%3ESource%3A%202022%20World%20Air%20Quality%20Report%3C%2Fem%3E%3C%2Fp%3E%0A
The specs
Engine: 4.0-litre flat-six
Power: 510hp at 9,000rpm
Torque: 450Nm at 6,100rpm
Transmission: 7-speed PDK auto or 6-speed manual
Fuel economy, combined: 13.8L/100km
On sale: Available to order now
Price: From Dh801,800
Results:

Men's wheelchair 800m T34: 1. Walid Ktila (TUN) 1.44.79; 2. Mohammed Al Hammadi (UAE) 1.45.88; 3. Isaac Towers (GBR) 1.46.46.

COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
If you go

The Flights

Emirates and Etihad fly direct to Johannesburg from Dubai and Abu Dhabi respectively. Economy return tickets cost from Dh2,650, including taxes.

The trip

Worldwide Motorhoming Holidays (worldwidemotorhomingholidays.co.uk) operates fly-drive motorhome holidays in eight destinations, including South Africa. Its 14-day Kruger and the Battlefields itinerary starts from Dh17,500, including campgrounds, excursions, unit hire and flights. Bobo Campers has a range of RVs for hire, including the 4-berth Discoverer 4 from Dh600 per day.

%3Cp%3E%3Cstrong%3EDirector%3A%3C%2Fstrong%3E%20Nag%20Ashwin%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%20%3C%2Fstrong%3EPrabhas%2C%20Saswata%20Chatterjee%2C%20Deepika%20Padukone%2C%20Amitabh%20Bachchan%2C%20Shobhana%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E%E2%98%85%E2%98%85%E2%98%85%E2%98%85%3C%2Fp%3E%0A
The burning issue

The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE.

Read part three: the age of the electric vehicle begins

Read part two: how climate change drove the race for an alternative 

Read part one: how cars came to the UAE

It

Director: Andres Muschietti

Starring: Bill Skarsgard, Jaeden Lieberher, Sophia Lillis, Chosen Jacobs, Jeremy Ray Taylor

Three stars

Monster

Directed by: Anthony Mandler

Starring: Kelvin Harrison Jr., John David Washington 

3/5

 

MATCH INFO

Pakistan 106-8 (20 ovs)

Iftikhar 45, Richardson 3-18

Australia 109-0 (11.5 ovs)

Warner 48 no, Finch 52 no

Australia win series 2-0

Dubai Women's Tour teams

Agolico BMC
Andy Schleck Cycles-Immo Losch
Aromitalia Basso Bikes Vaiano
Cogeas Mettler Look
Doltcini-Van Eyck Sport
Hitec Products – Birk Sport 
Kazakhstan National Team
Kuwait Cycling Team
Macogep Tornatech Girondins de Bordeaux
Minsk Cycling Club 
Pannonia Regional Team (Fehérvár)
Team Auvergne-Rhône-Alpes
Team Ciclotel
UAE Women’s Team
Under 23 Kazakhstan Team
Wheel Divas Cycling Team

Shubh Mangal Saavdhan
Directed by: RS Prasanna
Starring: Ayushmann Khurrana, Bhumi Pednekar

The%20specs
%3Cp%3E%3Cstrong%3EEngine%3A%20%3C%2Fstrong%3E2.3-litre%204cyl%20turbo%0D%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E299hp%20at%205%2C500rpm%0D%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E420Nm%20at%202%2C750rpm%0D%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3E10-speed%20auto%0D%3Cbr%3E%3Cstrong%3EFuel%20consumption%3A%20%3C%2Fstrong%3E12.4L%2F100km%0D%3Cbr%3E%3Cstrong%3EOn%20sale%3A%20%3C%2Fstrong%3ENow%0D%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3EFrom%20Dh157%2C395%20(XLS)%3B%20Dh199%2C395%20(Limited)%3C%2Fp%3E%0A

Bareilly Ki Barfi
Directed by: Ashwiny Iyer Tiwari
Starring: Kriti Sanon, Ayushmann Khurrana, Rajkummar Rao
Three and a half stars

Iraq negotiating over Iran sanctions impact
  • US sanctions on Iran’s energy industry and exports took effect on Monday, November 5.
  • Washington issued formal waivers to eight buyers of Iranian oil, allowing them to continue limited imports. Iraq did not receive a waiver.
  • Iraq’s government is cooperating with the US to contain Iranian influence in the country, and increased Iraqi oil production is helping to make up for Iranian crude that sanctions are blocking from markets, US officials say.
  • Iraq, the second-biggest producer in the Organization of Petroleum Exporting Countries, pumped last month at a record 4.78 million barrels a day, former Oil Minister Jabbar Al-Luaibi said on Oct. 20. Iraq exported 3.83 million barrels a day last month, according to tanker tracking and data from port agents.
  • Iraq has been working to restore production at its northern Kirkuk oil field. Kirkuk could add 200,000 barrels a day of oil to Iraq’s total output, Hook said.
  • The country stopped trucking Kirkuk oil to Iran about three weeks ago, in line with U.S. sanctions, according to four people with knowledge of the matter who asked not to be identified because they aren’t allowed to speak to media.
  • Oil exports from Iran, OPEC’s third-largest supplier, have slumped since President Donald Trump announced in May that he’d reimpose sanctions. Iran shipped about 1.76 million barrels a day in October out of 3.42 million in total production, data compiled by Bloomberg show.
  • Benchmark Brent crude fell 47 cents to $72.70 a barrel in London trading at 7:26 a.m. local time. U.S. West Texas Intermediate was 25 cents lower at $62.85 a barrel in New York. WTI held near the lowest level in seven months as concerns of a tightening market eased after the U.S. granted its waivers to buyers of Iranian crude.
MATCH INFO

Day 2 at the Gabba

Australia 312-1 

Warner 151 not out, Burns 97,  Labuschagne 55 not out

Pakistan 240 

Shafiq 76, Starc 4-52

The specs

Engine: 3-litre twin-turbo V6

Power: 400hp

Torque: 475Nm

Transmission: 9-speed automatic

Price: From Dh215,900

On sale: Now