Three lessons from Warren Buffett for forex traders
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"Always trade based on insider information"
Buffett a hypocrite: Loeb
Hedge fund mogul Daniel Loeb on Wednesday took aim at the "Oracle of Omaha," calling beloved billionaire Warren Buffett a hypocrite.
"I love how he criticizes hedge funds yet he really had the first hedge fund. He criticizes activists but he was the first activist," Loeb, who runs $17.5 billion hedge fund Third Point, said about Buffett who has been running conglomerate Berkshire Hathaway for 50 years.
Loeb, known in investment circles for his sharp tongue and top returns, made the comments at the SkyBridge Alternatives Conference, known as SALT, less than one week after Buffett hosted his company's shareholder meeting in Omaha.
Buffett, whose own strong record earned him his nickname, has in the past said that hedge funds could pose a threat to global markets and has a running bet with a New York-based hedge fund firm that hedge funds will underperform a low-cost index tracker over ten years. So far Buffett is winning the bet, he said at the weekend meeting in Omaha.
In Las Vegas, where Loeb was speaking to hundreds of hedge fund managers, investors, and lawyers in the Bellagio ballroom, the crowd was clearly on the fund manager's side, judging by the hearty applause his comments got.
"He has a lot of wisdom but there is a disconnect," Loeb said referring to the things Buffett says and what he actually does.
He quickly tried to walk back his comments by saying he took a "potshot" at the 84-year old investor and philanthropist who is widely seen as a hero by many other prominent hedge fund managers.
Of course he is. The same as Soros, and the whole gang. They tell one thing and do completely the opposite. They are doing what all they think they deserve : they are pretending to be politicians loved by people
Of course he is. The same as Soros, and the whole gang. They tell one thing and do completely the opposite. They are doing what all they think they deserve : they are pretending to be politicians loved by people
That is the principle which works if you want to get rich. You can not get rich and stay honest
He does it all the time
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arren Buffett is the world's most famous long-term investor but forex traders can learn from him too.With Buffett delivered earnings yesterday and the Wall Street Journal got some lessons from a friend of the 84-year-old Oracle.
Here are 3 that will make you a better forex trader.
1)
"One of the hardest things for most investors is to sit by and watch other people make money," says Howard Marks, co-chairman of Los Angeles-based Oaktree Capital Management, who has known Mr. Buffett for many years. "But that doesn't bother Warren at all when the opportunities are outside his sphere."
FOMO, the fear of missing out, is a pitfall that isn't discussed often enough. In the information age and with global electronic trading, there are opportunities everywhere. In hindsight, a million dollars a week is a cinch; let it go or risk chasing trades better left alone.
2)
"Warren has the ability to figure out which things are important in a whole narrative and to ignore everything else," Mr. Marks says.
This is an art, but it comes with practice. There are no rules because sometimes a certain theme or inter-related market will matter and other times it won't. Greece is a perfect example at the moment because sometimes it matters, sometimes it doesn't. The irrevocable themes in forex are growth and inflation. Let those be your compass.
3)
" extraordinarily good at knowing what he's good at and what he's not, and staying away from the latter."
Don't fall in love with the flavour of the week. Even if there isn't anything you're particularly good at, decide what you want to be and stick with it. The underlying message here is simple -- stay disciplined.
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