Given his success over multiple decades and estimated net wealth of US$117 billion, Warren Buffett is rightfully considered to be one of the most successful investors of our time. So, clearly, there is a lot that we can learn from the Oracle of Omaha when it comes to our own investment journeys.
One of the key reasons that Buffett has been able to grow his vast wealth is that he has chosen to invest in quality businesses and then stuck with them for the long haul. And if you want to be successful as an investor, it pays to follow his lead.
One of Buffett's most famous quotes is:
If you aren't willing to own a stock for 10 years, don't even think about owning it for 10 minutes.
If you follow this same approach, then your chances of making money could be a lot higher.
Be like Buffett
Unfortunately, investors often lose money in the share market by selling their ASX shares when their value starts to fall. In addition, they often limit the extent to which they can grow their wealth by selling out of winning stocks with a modest gain rather than being patient and waiting for even larger gains to compound over time.
If you take the Buffett approach and buy and hold quality ASX shares for the long-term, you can avoid this.
It is worth noting that buy and hold doesn't necessarily mean set and forget. It's more about holding onto something for as long as your investment thesis remains intact. Most companies will go through a difficult period every so often. But it doesn't mean that you need to sell out at that point if the long-term outlook remains rosy.
Take for example CSL Limited (ASX: CSL). It had a reasonably difficult time in FY 2022 because of COVID-related headwinds. This led to its shares trading largely flat for much of the first half of 2022.
However, if you had sold out at that point, you would have missed out on a gain of almost 20% from mid-June 2022 to today. And with tailwinds now firmly in its sails, who knows what future gains you could have sacrificed.
Foolish Takeaway
It's fair to say that investing in ASX shares isn't for the faint of heart. There are likely to be times when you're tempted to sell stocks either to minimise losses or capitalise on gains. However, if you really want to do well as an investor, it pays to do what Buffett says and hold on as long as you can.
After all, if you're patient, you might be rewarded in a very big way. Just like Buffett has been.
