 From this you can see that just buying a good business is not enough. Buffet will only invest when This is the most important investing lesson that I learned from Warren Buffett and Charlie Munger from their most recent 6 hour long AGF. I know there are a lot of information online regarding what people have learned from Warren Buffett and Charlie Munger but what I'm going to share with you next is something that I've never seen anybody talk about it on the internet yet and in my opinion this is probably one of the most important investing lessons that you must learn from the most recent Warren Buffett AGF and once you understand what I'm going to share with you next investing becomes so simple. Hi everyone this is Chloe and welcome back to my channel. Before I review to you what is this very important investing lesson, I would appreciate if you can give this video a thumbs up as well as subscribe to my channel because this channel is all about empowering people to get started investing the right way so that more people like you can achieve your financial goals faster and your thumbs up means a lot to me for me to keep going and inspire more people to start investing safely. With that, let's get started. Throughout his decades of investing Buffett always stresses about the importance of management as the management credible and trustworthy and have they been treating their shareholders like partners with the aim of creating long term shareholder value for them. Without a doubt this is exactly what Warren Buffett and Charlie Munger have always tried to do for Berkshire Hathaway shareholders. In his most recent shareholder letter, Warren Buffett said, I will go in both forms of ownership as to make meaningful investments in businesses with both long lasting, favorable economic characteristics and trustworthy managers. From this you can see that just buying a good business is not enough. Buffett will only invest when the management is trustworthy. The presence of quality management is one of the most important investing metrics before Buffett makes any form of investment decision. In fact, he also said, We are understanding about business mistakes but our tolerance for personal misconduct is zero. This shows that integrity is something that Charlie Munger and Warren Buffett hold very dearly too. The point I'm trying to say is more than than not, we as investors tend to just focus on buying good businesses. Is company making more money? Is the EPS increasing? Does it have free cash flow? Etc. But we tend to ignore the importance of having a good management because we all know good management is something that is intangible. You can't really tell off the numbers and it requires a lot more effort by going through interviews with the CEO, reading books about their personal biographies or even attending AGM just to have a sense of what is the management team like. And even after going through all these work, it could just be the tip of iceberg and you may never truly understand who the management really is. That's why most investors would just forget about this aspect and tend to just to buy good companies based on the numbers. However, history has repeatedly told that even if it's a good company, if it's run by bad management, the company will eventually turn back. One of the examples is Microsoft. After Bill Gates, Steve Bomer took over as the previous Microsoft CEO. However, the company remains stagnant for close to 10 over years. And as a result, the stock price also didn't move much for over 10 over years. It was not until the current CEO Satya Nadella took over and then the business continued to perform better and better. And that's how the stock price of Microsoft continued to soar over the past few years under the management of Satya Nadella. But Satya Nadella's transformation of Microsoft didn't just take one day. It took years. And that's why it's so important to let time to do its magic and truly tell whether is this a capable management team or not. And time will also let us know whether the management team is able to stick to their words and live up to the promises that they made years ago. So from this investing lesson, I asked myself how much confidence and how much do I know about the management team of the companies that I am currently investing? And I think this should be the exact question that you should be asking yourself too. Because when I'm very honest with myself, I realize that I do not understand most of the management team out there because I have not gone the extra mile to research about them. For example, if you ask me, do I know enough about Google CEO? Or do I really have a lot of faith in the character of Elon Musk? Hmm, I have no idea. So I continue to ask myself if I don't have confidence about them or do not even understand them as a person? How am I supposed to have the peace of mind when I'm investing in these companies? And I keep on asking myself, among all the companies that I'm currently investing in, which few companies do I have more confidence in the management team? And then my answer becomes clearer and clearer. One of them is Berkshire Hathaway for sure, followed by Microsoft and Apple. Since this video is about lessons I learned from Warren Buffett himself, that's why I will be focusing on Berkshire Hathaway. But if you also want to know my reasons why I have more confidence towards Microsoft, as well as Apple's management team, do let me know in the comment below by typing Microsoft and Apple. If there are more than enough demand, then I will create another video for you. Now going back to the management team of Berkshire Hathaway. I believe all of us agree there is no doubt that Buffett and Munger have displayed tremendous integrity over the years, and I believe they are going to continue to act on the behalf of their shareholders to safeguard our interests in the long run. In fact, this is what Warren Buffett said in his most recent annual shareholder letter. They simply know that Charlie and I, along with our families and close friends, continue to have very significant investment in Berkshire, and they trust us to treat their money as we do our own. And that is the promise we can make. And we all know Buffett is a man who keeps his promise. And that's how over the years, Berkshire Hathaway stock price has continued to grow tremendously under the management of Warren Buffett and Charlie Munger. And if you have the chance to visit Berkshire AGM yourself, I'm sure you'll be touched when 40,000 shareholders stand up together and clap for Warren Buffett and Charlie Munger when they appear on the stage. This shows how much respect that we all have for these two old wise gentlemen. To be honest, I actually had tears in my eyes when I saw this ascending ovation. Every single one of us applauding for their dedication to their work, to the success of the company, and ultimately the success of the shareholders. So if you have not attended any Berkshire AGM before, I highly recommend you to go. Especially when Charlie Munger is going to turn 100 years old next year. This experience of being able to stick in the same room as Warren Buffett and Charlie Munger is truly mind-blowing. I still clearly remember in order for us to grab the front row, we woke up at 3am in the morning and started queuing at the Berkshire AGM entrance. I know it sounds crazy and tiring, but trust me, the experience is totally worth it. Because not only will you be able to make friends while you're queuing, you get to see Warren Buffett and Charlie Munger up close and truly live and breathe their wisdom. And just from this experience itself, you get to understand them a lot more from just reading something from the internet. This AGM has been a tremendously thought-provoking experience for me because it reminds me of the importance of understanding what I'm investing in, not just on the company level, but also the management level. Who is running the company? What is their track record? Are they somebody who are trustworthy? And if you are unsure, don't rush into any investment decision so that you can truly invest with a piece of mind, knowing that the company management is going to take good care of you. And if you really don't understand individual companies, another way to really get started is what Warren Buffett said, invest in a low-cost index fund such as the S&P 500, which comprises of the top 500 companies publicly traded in the US. One thing that Warren Buffett has repeatedly advocated for any retail investors to grow their long-term wealth. However, the most important thing is still to get yourself educated first. Because Warren Buffett also said, the more you learn, the more you will earn. If you also want to get started in your investing journey step by step, then do join us in our upcoming 3-2-hour investing masterclass. All you have to do is to click on the link around this video and register for your free spot. And if you want to have more investing insights, then do join my telegram channel as well because I constantly post daily updates over there. Also check out some of the videos right here to continue your learning journey. With that, I will see you in the next video. Arigato!