Warren Buffett: How to Make 20% Returns | Stock Market Investment Strategy (Explained for Beginners)

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Warren Buffett has 3 Rules for maintaining a 20% annual return for over 57 years. He explains a strategy for investing in strong stocks and breaks it down for beginners. Let's dive in.

Intro:
Warren Buffet is one of the most successful and well-known investors in history. He is currently worth over $100 Billion and has averaged a staggering 20% annual return during his 57 year career as Berkshire Hathaway's CEO.

To put that in perspective, if you were to invest $1000 in the S&P 500 in 1964, which has averaged an annual return of 10.2% with dividends reinvested, you would today be left with just over a quarter million dollars ($253,717). Which is certainly nothing to scoff at.

However, if you were to invest that same $1000 dollars with Warren Buffett when he began Berkshire Hathaway in 1964, you would have amassed a fortune of over 32 million dollars ($32,608,515).

That's the difference a 10% return makes, and it's staggering when placed side by side.

So what are Warren Buffets tips for beating the market?
Are these tips still applicable today?
And what could this mean for your future?

Rule 1: Treat a Stock Like a Business

Businesses can provide you a return on your money by:
- Paying you out in dividends
- Buying back company shares on the stock market
- And thirdly, it can reinvest the money back into the business.

Rule 2: Make sure the company is currently at a good value
- Discounted Cash Flow
- Multiple Based Approach
- Asset-Based Approach

Rule 3: Maintain an even temperament
- "Emotional stability is even more important than intelligence."

Are these tips still applicable today?

What could this mean for your investing and future?

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