The Daily Buffett

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The Value of Approximation

July 29th

It is better to be approximately right than precisely wrong.

Warren Buffett

Investing is a game of approximation, not precision. The financial market is unpredictable, and an obsession with precision can blind us to the more significant, broader trends and developments. Instead, aim for a general understanding of the market and its trends. Your perspectives, though not exact, should be based on thorough research and insightful analysis.

A precise calculation or forecast might seem impressive, but falling for the allure of precision can lead you down the wrong path. On the contrary, an estimate that is broadly correct, even if not razor-sharp, can guide you towards a wise and profitable investment decision.

In the grand scheme of investing, the market doesn't bow to precision. So, rather than striving for exactness, choose to have a more encompassing understanding of the financial landscape. Because in this volatile world of investing, a broad stroke of correctness is often more valuable than misplaced precision.

After all, a practical, approximate direction is better than a precise misstep when navigating through the intricate maze of the financial market.

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