Warren Buffet is Wrong

It was he who first said.... "Rule No. 1: Never lose money; rule No. 2: Don't forget rule No. 1". 

Warren Buffet has taken losses, just like the rest of us. The idea that one has to never lose in order to win in the world of investing has to die a horrible death. Of course Mr. Buffet knows losses are apart of the game, especially when years ago he took a $900 million loss on the US dollar when he shorted it, thinking the dollar was doomed, only to see it surge soon after it bottomed. Or recently when Berkshire Hathaway lost $11 billion in the recent stock market sell off a few months back. 

No matter who the investor is, they have all taken losses, a lot of them. The goal though is to make more money than you lose. It's just that simple. Can you lose money overall if you win 90% of the time? You sure can if you're constantly over leveraged. Can you become incredibly rich being right only 40% of the time? You bet. The goal for every trader/investor is to simply work out a strategy and system that is favourable in the long term and effectively produces profits that when added all up, out weigh the sum of the losses. 

The reason Warren Buffet is so rich, is because he doesn't let the fear of loss stop him for going for the win. I think what he meant with this quotation was "play to win". He's taken losses but his winners vastly out shine his losers. That's how you and I need to be. Act on a winning system consistently despite your fear of loss. Being a trend follower, the losses will come... and when they do remember, they are the precursors to large financial gains.