Warren Buffett and Mike Tyson seem like an unlikely pair, and that’s because they are. One is a famed investor that created a fortune for himself and others by using his mind, the ability to read the market, and beating the odds. Mike Tyson relies on his physical strength, ability to read his opponent’s moves, and beating his opponents.
The two operate in very different areas of life, and both can be considered among the most famous individuals in their respective spheres. But that’s not the only thing that’s common between them.
Buffett and Mike Tyson
Buffett made a comparison between himself and the famed boxer in a university lecture in 1996. Buffett said that he is operating in a market that rewards him well, disproportionately well. He inferred that if he were in another country, he might not have made that much using his talent. He said the same about Mike Tyson.
He said that if someone (like Mike Tyson) can knock a guy out in 10 seconds and earn $10 million for it, this world would pay a lot for it. This comparison is very modest, and Buffett, even though he is considered one of the greatest investors of our times, basically said that he benefited from the right circumstances.
This might not look like conventional investment wisdom that Buffett is used to dispensing, but there is a very important lesson here. Investors should try to make the best of their circumstances and options available to them.
Warren Buffett and Mike Tyson have one more thread connecting the two. Buffett insured Tyson about 25 years ago.
An investment option
For Canadian investors, making the best of investment circumstances is easy, since there are several growing industries and companies to choose from. One of these companies is First National Financial (TSX:FN). The company is Canada’s largest non-bank lender and, as of last year, it furnished loans to about 300,000 applicants.
The company has a market cap of about $2.25 billion. The balance sheet is stable but not very strong. The earnings are growing steadily for the last five years. The stock took a beating and is still discounted, and that’s good news to investors because you don’t just get to buy a good company at a reasonable price; you can also lock in a 6.9% yield. That’s enough to get you $115 a month in dividend income if you invest $20,000 in the company.
One of the best things we can learn from Warren Buffett is the value of the long-term holding. He has proven, time and time again, that you buy into a good company and stand by it for decades; you will be rewarded in most cases. And if you can buy good companies at a great price when the market crashes, you might be able to reach your investment goals a few years earlier.
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Fool contributor Adam Othman has no position in any of the stocks mentioned.