Investment

Want to invest like Warren Buffett? Ignore pundits and 'never risk permanent loss of capital,' says the billionaire – CNBC

Published

7 months ago

February 26, 2024

If you haven’t read Warren Buffett’s annual letter to shareholders, which the Berkshire Hathaway chairman released on Saturday, do yourself a favor.

While you’re at it, read a few of the back issues, too. Within them, you’ll find the source material for many of the pearls of investing wisdom you’ve seen floating next to pictures of Buffett’s face on the internet for years. After all, who wouldn’t want to learn all they could from one of the greatest investors of all time?

In the meantime, here are a few key lessons for investors from this year’s letter.

Ignore market punditry

In the 2024 letter, Buffett imagines his target reader as someone similar to his sister, Bertie — a wise and financially savvy long-term investor in Berkshire. While she has some knowledge of how accounting works, Buffett writes, she wouldn’t pass a CPA exam.

A major asset for Bertie and investors like her: “She is sensible — very sensible — instinctively knowing that pundits should always be ignored,” says Buffett. “After all, if she could reliably predict tomorrow’s winners, would she freely share her valuable insights and thereby increase competitive buying? That would be like finding gold and then handing a map to the neighbors showing its location.”

It’s an astute observation, and one worth remembering the next time a pitch for a hot stock, or cryptocurrency or an NFT comes across your timeline. Or when someone on YouTube tells you their day trading strategy will make you rich. They’re often looking to make money from you, rather than for you.

Next time you get such a pitch, be like Bertie. “Bertie understands the power — for good or bad — of incentives, the weaknesses of humans, the ‘tells’ that can be recognized when observing human behavior,” Buffett writes. “She knows who is ‘selling’ and who can be trusted. In short, she is nobody’s fool.”

Stick with U.S. stocks for the long term

Buffett often recommends that non-professional investors gravitate toward index funds that seek to replicate the performance of the U.S. stock market.

The advantages are twofold. By spreading your portfolio across a wide array of stocks, you vastly decrease the possibility that a large bet on a particular investment could go south and tank your performance.

Plus, if markets remain true to their historical upward trajectory, you should be able to earn a substantial return over time.

“I can’t remember a period since March 11, 1942 — the date of my first stock purchase — that I have not had a majority of my net worth in equities, U.S.-based equities. And so far, so good,” Buffett writes.

When he decided to invest, the Dow Jones Industrial Average had fallen below 100 points. Buffett says he was down about $5 on the first day. But he wasn’t in the red for long.

“Soon, things turned around and now that index hovers around 38,000,” Buffett writes. “America has been a terrific country for investors. All they have needed to do is sit quietly, listening to no one.”

Keep your cool in chaotic markets

The history of American markets has also included dramatic downslides, a phenomenon that has only been amplified in recent years by the speed at which information travels on the internet.

That isn’t changing anytime soon, says Buffett: “Such instant panics won’t happen often, but they will happen.”

In a section called “Our Not-So-Secret-Weapon,” Buffett says that such downturns have historically been buying opportunities for Berkshire to snap up quality stocks at a discount.

As investors, Buffett and his colleagues have been able to respond to panicked markets with “large sums and certainty of performance,” he writes. Perhaps more importantly, they haven’t allowed short-term noise in the market to tempt them to sell their assets at a low value.

“One investment rule at Berkshire has not and will not change: Never risk permanent loss of capital,” Buffett writes. “Thanks to the American tailwind and the power of compound interest, the arena in which we operate has been — and will be — rewarding if you make a couple of good decisions during a lifetime and avoid serious mistakes.”

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Investment

Canada’s Probate Laws: What You Need to Know about Estate Planning in 2024

Published

3 hours ago

September 19, 2024

Harry Miller

Losing a loved one is never easy, and the legal steps that follow can add even more stress to an already difficult time.

For years, families in Vancouver (and Canada in general) have struggled with a complex probate process—filled with paperwork and legal challenges.

Thankfully, recent changes to Canada’s probate laws aim to make this process simpler and easier to navigate.

Let’s unearth how these updates can simplify the process for you and your family.

What is probate?

Probate might sound complicated, but it’s simply the legal process of settling someone’s estate after death.

Here’s how it works.

Validating the will. The court checks if the will is legal and valid.
Appointing an executor. If named in the will, the executor manages the estate. If not, the court appoints someone.
Settling debts and taxes. The executor (and you) pays debts and taxes before anything can be given.
Distributing the estate. Once everything is settled, the executor distributes the remaining assets according to the will or legal rules.

Probate ensures everything is done by the book, giving you peace of mind during a difficult time.

Recent Changes in Canadian Probate Laws

Several updates to probate law in the country are making the process smoother for you and your family.

Here’s a closer look at the fundamental changes that are making a real difference.

1) Virtual witnessing of wills

Now permanent in many provinces, including British Columbia, wills can be signed and witnessed remotely through video calls.

Such a change makes estate planning more accessible, especially for those in remote areas or with limited mobility.

2) Simplified process for small estates

Smaller estates, like those under 25,000 CAD in BC, now have a faster, simplified probate process.

Fewer forms and legal steps mean less hassle for families handling modest estates.

3) Substantial compliance for wills

Courts can now approve wills with minor errors if they reflect the person’s true intentions.

This update prevents unnecessary legal challenges and ensures the deceased’s wishes are respected.

These changes help make probate less stressful and more efficient for you and other families across Canada.

The Probate Process and You: The Role of a Probate Lawyer

(Image: Freepik.com)

Working with a probate lawyer in Vancouver can significantly simplify the probate process, especially given the city’s complex legal landscape.

Here’s how they can help.

Navigating the legal process

Probate lawyers ensure all legal steps are followed, preventing costly mistakes and ensuring the estate is managed properly.

Handling paperwork and deadlines

They manage all the paperwork and court deadlines, taking the burden off of you during this difficult time.

Resolving disputes

If conflicts arise, probate lawyers resolve them, avoiding legal battles.

Providing you peace of mind

With a probate lawyer’s expertise, you can trust that the estate is being handled efficiently and according to the law.

With a skilled probate lawyer, you can ensure the entire process is smooth and stress-free.

Why These Changes Matter

The updates to probate law make a big difference for Canadian families. Here’s why.

Less stress for you. Simplified processes mean you can focus on grieving, not paperwork.
Faster estate settlements. Estates are settled more quickly, so beneficiaries don’t face long delays.
Fewer disputes. Courts can now honor will with minor errors, reducing family conflicts.
Accessible for everyone. Virtual witnessing and easier rules for small estates make probate more accessible for everyone, no matter where you live.

With these changes, probate becomes smoother and more manageable for you and your family.

How to Prepare for the Probate Process

Even with the recent changes, being prepared makes probate smoother. Here are a few steps to help you prepare.

Create a will. Ensure a valid will is in place to avoid complications.
Choose an executor. Pick someone responsible for managing the estate and discuss their role with them.
Organize documents. Keep key financial and legal documents in one place for easy access.
Talk to your family. Have open conversations with your family to prevent future misunderstandings.
Get legal advice. Consult with a probate lawyer to ensure everything is legally sound and up-to-date.

These simple steps make the probate process easier for everyone involved.

Wrapping Up: Making Probate Easier in Vancouver

Recent updates in probate law are simplifying the process for families, from virtual witnessing to easier estate rules. These reforms are designed to ease the burden, helping you focus on what matters—grieving and respecting your dead loved ones’ final wishes.

Despite these changes, it’s best to consult a probate lawyer to ensure you can manage everything properly. Remember, they’re here to help you during this difficult time.

Economy

Energy stocks help lift S&P/TSX composite, U.S. stock markets also up

Published

2 days ago

September 17, 2024

Anne Joseph

TORONTO – Canada’s main stock index was higher in late-morning trading, helped by strength in energy stocks, while U.S. stock markets also moved up.

The S&P/TSX composite index was up 34.91 points at 23,736.98.

In New York, the Dow Jones industrial average was up 178.05 points at 41,800.13. The S&P 500 index was up 28.38 points at 5,661.47, while the Nasdaq composite was up 133.17 points at 17,725.30.

The Canadian dollar traded for 73.56 cents US compared with 73.57 cents US on Monday.

The November crude oil contract was up 68 cents at US$69.70 per barrel and the October natural gas contract was up three cents at US$2.40 per mmBTU.

The December gold contract was down US$7.80 at US$2,601.10 an ounce and the December copper contract was up a penny at US$4.28 a pound.

This report by The Canadian Press was first published Sept. 17, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

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Economy

S&P/TSX gains almost 100 points, U.S. markets also higher ahead of rate decision

Published

6 days ago

September 13, 2024

Anne Joseph

TORONTO – Strength in the base metal and technology sectors helped Canada’s main stock index gain almost 100 points on Friday, while U.S. stock markets climbed to their best week of the year.

“It’s been almost a complete opposite or retracement of what we saw last week,” said Philip Petursson, chief investment strategist at IG Wealth Management.

In New York, the Dow Jones industrial average was up 297.01 points at 41,393.78. The S&P 500 index was up 30.26 points at 5,626.02, while the Nasdaq composite was up 114.30 points at 17,683.98.

The S&P/TSX composite index closed up 93.51 points at 23,568.65.

While last week saw a “healthy” pullback on weaker economic data, this week investors appeared to be buying the dip and hoping the central bank “comes to the rescue,” said Petursson.

Next week, the U.S. Federal Reserve is widely expected to cut its key interest rate for the first time in several years after it significantly hiked it to fight inflation.

But the magnitude of that first cut has been the subject of debate, and the market appears split on whether the cut will be a quarter of a percentage point or a larger half-point reduction.

Petursson thinks it’s clear the smaller cut is coming. Economic data recently hasn’t been great, but it hasn’t been that bad either, he said — and inflation may have come down significantly, but it’s not defeated just yet.

“I think they’re going to be very steady,” he said, with one small cut at each of their three decisions scheduled for the rest of 2024, and more into 2025.

“I don’t think there’s a sense of urgency on the part of the Fed that they have to do something immediately.

A larger cut could also send the wrong message to the markets, added Petursson: that the Fed made a mistake in waiting this long to cut, or that it’s seeing concerning signs in the economy.

It would also be “counter to what they’ve signaled,” he said.

More important than the cut — other than the new tone it sets — will be what Fed chair Jerome Powell has to say, according to Petursson.

“That’s going to be more important than the size of the cut itself,” he said.

In Canada, where the central bank has already cut three times, Petursson expects two more before the year is through.

“Here, the labour situation is worse than what we see in the United States,” he said.

The Canadian dollar traded for 73.61 cents US compared with 73.58 cents US on Thursday.

The October crude oil contract was down 32 cents at US$68.65 per barrel and the October natural gas contract was down five cents at US$2.31 per mmBTU.

The December gold contract was up US$30.10 at US$2,610.70 an ounce and the December copper contract was up four cents US$4.24 a pound.

— With files from The Associated Press

This report by The Canadian Press was first published Sept. 13, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

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