The real question when you buy a stock is – “Am I getting my money’s worth?”
This is one of Warren Buffett’s key principles. It focuses the decision making on the real issue of the value of the business being bought, and away from trying to guess what might happen in the market.
It is unwise to pass up something that’s attractively priced today on the chance it may be more attractive tomorrow. That might happen, however the future is never certain. Wait on the side line and you risk missing out. What matters is that you are getting value for your money when you buy.
You will make your best buys when pessimism is pervasive. And then a terrible market or a terrible economy is your friend.
“Nobody knows what the market’s going to do the next day. But you shouldn’t pay any attention to that. If you’re getting your money’s worth in a stock, buy it and forget it. It doesn’t mean you can’t buy it cheaper tomorrow. It may turn out that way. But the real question is — Am I getting my money’s worth when I buy?.” Warren Buffett