Warren Buffett: How Long Is The Right Time To Wait For Opportunities

Johnny HopkinsCharles Munger, Warren BuffettLeave a Comment

During the 1998 Berkshire Hathaway Annual Meeting, Warren Buffett states that they haven’t found attractive investment opportunities in equities for a while. He also discusses how long investors should wait for the right opportunities. Here’s an excerpt from the meeting:

Buffett: Well you’re correct that we have not found anything to speak of in equities in a good many months and the question of how long we wait. We wait indefinitely. We are not going to buy anything just to buy something.

We will only buy something if we think we’re getting something attractive and that… and incidentally if things were five percent cheaper, were ten percent cheaper, that wouldn’t change anything materially.

So we have no idea when that period ends. We have no idea whether equities stay where they are.

But even then aren’t in the least mouth-watering, so we won’t feel we’ve missed anything particularly if returns stay where they are.

Because if it turns out that these levels are okay, they still will not produce great returns from here in our view.

That doesn’t mean you couldn’t have a tremendous market in the short term or something of the sort. Markets can do anything. I mean you look at the history of markets and you just see everything under the sun.

But we will not… you know we have no time time-frame. If the money piles up the money piles up and when we see something that makes sense we’re willing to act very fast, very big, but we’re not willing to act on anything that doesn’t check out in our view.

You don’t get paid for activity, you only get paid for being right. Charlie?

Munger: An occasional dull stretch for new buying, this is no great tragedy in an investment lifetime. And other things may be possible in such an era too. I mean it isn’t like we have a quiver with only one arrow.

You can watch the entire discussion here:

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