Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

25 of 40
Buy low, sell high
David Herro
Manager, Oakmark International

I caddied for a stockbroker 30 years ago, from age 12 to 16. He told me never to forget the cardinal rule of investing: Buy low and sell high. Today I rely on a spin-off of that rule: Buy good-quality businesses at low prices, even if it's counter to the crowd, and sell high, even if what you're selling is in vogue.

People these days are buying what's in vogue - energy and emerging markets - but this means those stocks are getting more expensive. Pharmaceuticals, consumer products and financials are the opposite, and the huge valuation differences provide an opportunity for long-term investors.

NEXT: It's hard to exploit a trend

Last updated July 22 2008: 11:27 AM ET
More Galleries
Black Friday 2015 in pictures Shoppers around the country braved the crowds to get their hands on the best Black Friday deals. More
Driving the ultimate in '50s Mercedes-Benz style The SC was the car that re-introduced Mercedes-Benz as a global luxury car icon. More
Driving the world's first car Driving a replica of the 1886 Benz Patent Motorwagen, the first internal combustion automobile. More

Special Offer