Building a nest egg is hard, and deciding where to put one’s money is even harder. That being said, the sage advice from the Oracle of Omaha, Berkshire Hathaway’s (NYSE:BRK.A)(NYSE:BRK.B) Warren Buffett, does have some serious validity: make decisions that are “big and easy.”
Warren Buffett’s investment style over the years has been a patient one, in which Buffett pinpoints a very solid investment opportunity and continues to invest over a long period of time in a few companies, as long as the price for such companies remains reasonable.
The penchant to wait on the sidelines until an opportunity arises, and continue to chip away over a period of time in buying a greater percentage of such company, is truly something to behold. Berkshire Hathaway has continued to increase its holdings in a number of U.S. large-caps, including Apple Inc. (NASDAQ:AAPL), a great example of this strategy.
Buffett appears to be of the belief that investing in a few baskets, and putting most of one’s eggs in the best baskets, makes the most sense. In other words, limiting diversification (choosing companies based on merit rather than the potential diversification effects) to the best companies out there – making big and easy decisions – is how one of the greatest investors of all time has done it. Who is one to disagree with one of the best?
Invest wisely, my friends.