One Thing That Will Increase Your Investment Returns More Than Anything Else
The Great Warren Buffett is widely known as the best investor of all time.
Over the last 58 years he’s built his company from $100,000 to $435 billion at this point. He did this by earning average yearly investment returns of 20.5% over his still ongoing career.
During this same period the S&P 500 averaged 7.5% every year.
The difference between these two is enormous.
Let’s say you invested $10,000 with Buffett in 1962 when his career started and added no other money.
That $10,000 turns into $498,022,221 by the end of 2019.
Meanwhile if you invested $10,000 in the S&P, the initial investment turns into $663,271.
This is a difference of 750X or 75,000% in 58 years.
And it’s also the difference between being wealthy and working during your retirement.
There are many reasons Buffett’s been so successful.
But today I want to share the single key reason he’s done so well investing over the years because this key will help you improve your investment returns too.
Buffett has the concept called “swinging at the fat pitch.”
Hitting a baseball is one of the hardest things to do in all of sports.
It requires split second anticipation, reaction, and body mechanics to hit a ball well.
This takes years of practice to get good at.
But when you get good, you can sometimes anticipate what a pitchers going to throw next and the location he’s going to throw the ball at.
If you can do this it feels like you time slows down… Tis makes the ball look fatter and of course this makes it easier to hit.
If you’re a baseball fan you’ve probably heard a player after a great game say something like they knew what pitch was coming. They may also say the baseball looked as big as a beach ball too.
This is why its called a “fat pitch” because a beach ball is huge compared to a baseball.
If the batter is patient enough to wait for this “fat pitch” described above – one they feel know is coming – they increase their odds of hitting the ball hard and well.
This is also the single largest key to Buffett’s success.
Waiting for and only swinging at fat pitches when investing.
Buffett thinks, reads, and learns for years waiting for a great opportunity to come up. This requires great amounts of patience.
Especially now with the 24/7 market news bombarding us.
But if you’re patient and wait for fat pitches – great investments – in investing you’ll increase your odds of earning higher investment returns than average investors.
Does this work every time you invest? Of course not.
But it greatly increases your odds of success.
And as long-term investors this is how we gain a huge advantage over other investors.
This is especially important in times like we’re dealing with today…
• The crazy market swings
• Horrible economic news
• Massive uncertainty
• Historic unemployment
If you can be patient and wait for fat pitches – whether that’s today or 2 years from now – you’ll earn higher returns than average investors.
This is how Buffett built his enormous wealth. And how you can also.
But I don’t want to just tell you to do this… I want to show you the enormous power of patience when investing.
The above is a graph showing Buffett’s wealth accumulation over his lifetime.
Because of patience and his focus on the long term he earned 95%+ of his wealth after the age of 65.
Now, I’m not saying you’re going to become a millionaire or billionaire only by being more patient in the market.
But if you’re patient you greatly increase your odds of building wealth and reaching your goals.
Ignore the noise of the everyday market gyrations and wait for those fat pitches.
I guarantee this will improve your investment returns more than just about anything else.
Something else that will improve your investment returns is investing in great stocks…