Warren Buffett: 8 Investment Strategies To Revolutionize Your Portfolio

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Legendary investor Warren Buffett has had a lot to say about investing over the years, but not much of it has changed.

Many of his strategies are simple, but it’s very easy to let them slip away, especially in a bullish or volatile market. Buffett’s strategies may not seem revolutionary, but they are game-changing in their simplicity and effectiveness.

Here are Warren Buffett’s eight investment strategies to revolutionize your portfolio in 2025.

Invest for the Long Term

Buffett is a “buy-and-hold” guy if ever there was one. He carefully researches the companies he intends to buy, and once he decides to make the purchase, he keeps it as long as the company continues to be a good performer.

Buy a Business, Not a Stock

By looking at a company’s business rather than the past performance of the stock, Buffett chooses his investments with an eye to the future, not the past. Every investor knows that past performance is not indicative of future results — even if they don’t act on this knowledge! By selecting companies based on their business prospects, Buffett has achieved returns that most investors only dream about.

The Circle of Competence

Buffett’s strategy includes only investing in companies he thoroughly understands, and that are within what he refers to as his “circle of competence.”

The primary principle behind this is to know what you know, and, more importantly, know what you don’t know. As an example, Buffett famously resisted buying technology stocks for many years, insisting that he didn’t understand what companies like Apple and Microsoft did. While Buffett admits that he sometimes steps outside of this imaginary circle, he maintains that it is still a good strategy.

Financial Health

Buffett not only has strategies for investing well, but he also has strategies for overall financial health, and they boil down to a few simple tenets. The first is to live below your means.

“Do not save what is left after spending, but spend what is left after saving,” he is often quoted as saying. He also recommends avoiding debt and investing in yourself in terms of your education, talent and skills.

Buy Businesses That Have an Economic Moat

One of the things that makes businesses attractive to Buffett is an “economic moat” — a competitive advantage that makes it difficult for other businesses to take market share. More than just a first-to-market advantage, a competitive moat can include things like cost and efficiency advantages and intangible assets like intellectual property.

Apply a Margin of Safety

Buffett recommends calculating a company’s future prospects conservatively and then applying a margin of safety. In its simplest form, Buffett says that you want to buy a company for a third off of working capital. The margin of safety, in this case, one-third of working capital, is what makes the investment worthwhile even if your predictions for future results are off.

Emotional Discipline

Perhaps Buffett’s most well-known advice is to “be fearful when others are greedy, and greedy when others are fearful.” This quote summarizes the emotional discipline he applies to investing.

Letting emotion guide your investment decisions can quickly lead to trouble as you tend to hold on to bad investments for too long, which prohibits you from making good investments. Applying emotional discipline allows your decisions to be guided by the numbers rather than your feelings.

Use the 90/10 Strategy

Finally, Buffett provides a strategy for the average investor who doesn’t want or feels unable to choose stocks on their own.

In his 2013 letter to Berkshire Hathaway investors, Buffett revealed that he had advised the trustee of his personal trust to invest the cash that his wife will inherit under the terms of his will in a very specific way. He states that his instructions are to invest 10% in short-term government bonds and 90% in a low-cost S&P 500 index fund. He believes this strategy will provide better returns than what most investors can attain in any other way.

While these strategies may seem tame in comparison to some opportunities that may be available to investors, they have stood the test of time. If you’re investing for the long term, as Buffett advises, these strategies can help you get there.

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