market folly

It's that time of year again: Warren Buffett this weekend released his 2013 annual letter.  The Berkshire Hathaway man provides an update on operations but also offers pearls of investing wisdom.

One of the more insightful parts of his letter is a story he tells about a farm he bought a long time ago.  He compares owning a farm to the stock market by imagining a scenario where a neighboring farmer comes over everyday and offers him a price for his farm and Buffett's farm.

Buffett basically notes that this is the reality of the stock market: someone's throwing a price in your face every single day.  But with the farm, you aren't tempted with such regularity.  So to stay the course in a long-term investment, you have to tune out the noise.

Embedded below is Warren Buffett's annual letter for 2013:




You can download a .pdf copy here.

For more from the Oracle of Omaha, head to Warren Buffett's recommended reading list as well as Buffett and Munger's secrets to investing success.