Warren Buffett vs. Cathie Wood: Here’s the Difference Between Their Investment Strategies
Written by
Laura Beck
Edited by
T. Woods
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If you’re at all familiar with the investment world, the names Warren Buffett and Cathie Wood mean something to you. After all, these two investing titans have built incredible track records — but in very different ways. In fact, the way they invest is night and day.
Here are the differences between Warren Buffet and Cathie Wood’s investment strategies.
Buffett’s Value Approach
Warren Buffett is 93 years old, so he’s had plenty of time to get good at finding the right investments. He’s not interested in flashy, high-tech stocks — instead, he likes blue-chip stalwarts like Coca-Cola and American Express, that are trading for less than what they’re really worth. It’s how he’s made his billions.
Buffet is known for his patience. He’s held onto his favorite stocks for years, even decades. It doesn’t matter if the stock price goes up and down in the short term, he’s happy to earn steady dividends over the long haul.
Wood’s Growth Gameplan
Cathie Wood does things a little differently. She’s a growth investing specialist – meaning she’s always on the lookout for the next big disruptive technology. Her portfolio is filled with high-flying (and sometimes unprofitable!) tech names like Tesla, Zoom, and Coinbase. She’s willing to take on some serious risk in the hopes of reaping some serious reward.
And unlike Buffett, Wood is a bit quicker to make changes to her holdings. If she decides the investment isn’t playing out, she’ll cut her losses and move on.
A Clash of Investing Styles
Buffett and Wood’s approaches to investing couldn’t be more different.
Buffet likes diversification and blue chip companies and Woods favors innovative industries with the potential for explosive growth. Both have their place, and it’s all about feeling out which one is right for you. Or perhaps it’s a combination? Some value investing vs. some growth investing. Both can have a place in any portfolio.
Timeless Lessons from the Titans
Although the investing world is always changing, you can count on Warren Buffet and Cathie Wood to keep influencing how the rest of us do things. They both love investing and have proven that they can weather storms and still come out on top – a valuable lesson for any investor. If we follow their principals of researching your investments, staying true to your beliefs, and being patient while the market does its thing, we’ll all come out on top.
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