《It's Best to Have Your 'Quotation Machine' Quote Every Few Years》
Warren Buffett once said a thought-provoking thing: "If stocks could only be quoted once a year, everyone would invest much more rationally, but reality is not like that." This statement exposes the root of market irrationality—the overly frequent price fluctuations often distort investors' judgment.
In the framework of value investing, the essence of a stock is a part of ownership in a business, and its value depends on the business's ability to generate cash flow in the long term, rather than the short-term jumps or drops in quotes. But in reality, let alone quoting once a year, many people feel that even quoting once a day is 'too slow'. They focus on the intraday price fluctuations at the market open, calculate account gains and losses after the market closes, and some even refresh the market data every few minutes, turning investing into a 'guess the rise and fall game'.
This excessive focus on short-term prices can easily make people forget the original intention of buying. When stock prices suddenly drop, and the fundamentals of the business have not changed, they panic and sell at a loss; when they see others' stocks rising quickly, they can't help but chase high and switch stocks. As Buffett said, frequent quotes create countless 'noises', causing investors to waste their energy on short-term fluctuations rather than studying the true value of the business.
Real value investing requires learning to 'filter out the noise'—it's best to have your 'quotation machine' quote every few years. Just like holding shares in a private company, you wouldn't ask every day how much it is worth, but rather focus on how much it earned this year and how much it can earn in the future. By looking less at quotes and focusing more on value, one can avoid the trap of short-term speculation and find certainty that transcends cycles.
