The World’s Most Influential Investors to Learn From

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Investing is one of the most important tools for building wealth, whether it’s underpinning the cash flow of a business or saving funds for retirement. Dipping your toes into the world of financial investing can feel like a daunting prospect as a newbie. There’s a natural fear of getting your fingers burnt from day one. However, the concept of investing is much easier and more accessible when you take cues from those who’ve mastered the art in decades past. 

Today, we’re going to explore a trio of the most successful investors in the financial markets. Each of whom can teach you invaluable principles to apply to your own investment strategies.

Warren Buffett – the “Oracle of Omaha”

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Buffett is often the first name that springs to mind when it comes to successful financial investing – and rightly so. After all, this is a man reportedly worth over $146 billion. Even at the age of 94, Buffett continues to make moves in the financial markets which influence the rest of the industry.

As the chair and CEO of his own investment fund, Berkshire Hathaway, which he’s overseen with his long-time compatriot, Charlie Munger, Buffett has built an empire which consistently yields superior returns to global and national indices.

Buffett’s approach revolves solely around investing in value. This is a philosophy he embraced from Benjamin Graham, the man behind the book, The Intelligent Investor. Buffett conducts research to find undervalued assets in the stock market with a potential for long-term growth. Buffett is by no means a short-term investor, either. He picks undervalued stocks and then seeks to hold them, sometimes for decades on end. This is proof that taking a long-term approach to sustainable growth is better than boom and bust cycles.

Edward O. Thorp – the quant investing king

Edward O. Thorp is something of a legend in the world of financial investing, as well as the casino scene. Thorp started out as a professor in maths, who used his head for numbers to add a fresh dimension to blackjack strategy. His approach to this classic card game has led to people in all four corners of the globe trying their luck at taking on the dealer. Today, there are a range of interesting variants which also encourage blackjack players to think differently about this decades-old pastime.

After becoming notorious for his blackjack play, Thorp would later apply his love for numbers to the financial markets, becoming one of the pioneers of quantitative investing. Thorp’s appreciation for risk management and probability meant he was tailor-made for the hedge fund market. He developed his own mathematical models to spot mispriced and inefficient securities and assets in the market. All of which led to the long-term success of his Princeton/Newport Partners hedge fund.

One of the key principles to learn from Thorp’s investing style is to understand the maths behind your investments. Being able to calculate the potential upside and downside of an investment helps you to quantify and manage your risk.

Peter Lynch – the layman’s investor

The former manager of the Fidelity Magellan Fund, Peter Lynch, also deserves a mention due to his ability to drive strong financial returns during periods of high inflation between 1977 and 1990. Lynch’s mantra was to invest solely in companies and assets he understood inside out. Lynch insists today that retail investors can spot investment opportunities simply by conducting their own fundamental analysis of assets they know and love.

Lynch authored a book titled “One Up on Wall Street”, where he discusses in greater detail his buy what you know investing concept. The book is also a useful tool to help demystify the financial markets.

Lynch encourages everyday investors to pay close attention to the trends and products which affect your everyday life, first and foremost. Dig deeper into the financials and growth potential of companies you’re interested in before committing your own funds.

By taking the advice of this trio of investment icons, you can start to develop the same traits in the market, honing your craft and staying the course to build a brighter financial future for you or your business.