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The Best Investing Advice I’ve Ever Heard (From Warren Buffett!)

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Everybody knows the name Warren Buffett. Regarded as one of the best investors of all time, Buffett is also called the Oracle of Omaha for his ability to play the stock market and turn a profit, even during times of a recession.

Most investors turn to fearful market moves when the economy faces a slump. Buffett, however, capitalizes on the long-term potential that the bear market has. It is every investor’s dream to become as successful as the living legend himself.

I am going to discuss two vital pieces of advice Warren Buffett has for investors that can help them emulate his terrific success in stock market trading. Additionally, I will talk about Suncor Energy (TSX:SU)(NYSE:SU) — a Canadian energy sector stock Buffett scooped up as part of his long-term strategy.

Invest in yourself

The first piece of advice Warren Buffett has for investors is to invest in themselves first and foremost. Investing in yourself is the best thing you can do. Focus on doing everything that improves your talents, because that is one thing nobody can take away from you.

You can run up huge deficits on bad business decisions, and the dollar value can drop to devastating lows. Calamities of all kinds can happen, but if you have talents and you focus on, maximizing your potential, you have an asset you can rely on.

It doesn’t mean going to college. You can do anything to improve what you’re already good at. Buffett himself, for instance, took up Dale Carnegie’s course to help with his communication skills. He paid $100 for it, and it was worth more to Warren Buffett than a college degree.

Get out of cash and into assets

The second piece of advice by the Oracle of Omaha is to stay away from hoarding cash and get into acquiring assets instead. Buffett says that cash is always a bad investment. There was a time that everybody would assume cash is king. Warren disagreed. Holding currency does not produce anything, and its value can quickly go down over time.

According to Buffett, you should only have as much cash as you might need. If you have any surplus amount, you should focus on investing it in owning fantastic businesses.

The Suncor Energy stock could be an ideal asset to consider to this end. Buffett owns around 15 million shares of Suncor valued at well over US$400 million. It is easy to understand why he owns almost 1% of the entire oil sands giant.

The industry is increasingly unpopular as the general trend is shifting towards renewable sources. It makes Suncor a contrarian investment from Buffett — something he’s done plenty of times in the past.

The valuation for Suncor is attractive, and the company is showing all the signs for reliable companies he looks for. The company has an industry-leading position and a wide economic moat.

Foolish takeaway

As fears of a recession increase, there is no better time to follow Warren Buffett’s advice than right now. Focus on investing in yourself and move out of cash. Invest your surplus capital in owning the shares of reliable dividend-paying companies. Suncor is trading for $37.45 per share at the time of writing, offering a dividend yield of 4.97%. I think it could be an excellent place to start.

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Adam Othman has no position in any of the stocks mentioned.

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