Why Warren Buffett's 19.8% Annualized Returns Remain Unmatched

investing.com:

Interest rates, recessions, crises, bubbles, inflation, pandemics, wars – you name it, Warren Buffett has navigated through every possible event in an investor's life.

Yet, his results are nothing short of incredible, boasting an annualized return of 19.8% from 1965 to the present, compared with 9.9% for the S&P 500 index. This makes him an outstanding performer and the best investor in history, thanks to the durability and consistency he has demonstrated over the years.

While Buffett's ability to select the right stocks is often attributed to his success, it is not an easy skill to acquire, contrary to popular belief. However, there is another skill that is accessible to everyone, and that is patience. Developing patience in investing is crucial.

You won't believe it, but Apple (NASDAQ:AAPL), which happens to be a significant stock in the Berkshire Hathaway (NYSE:BRKb) portfolio, has been held for more than seven years since its purchase in early 2016.

To summarize, Warren Buffett's long-term holdings include:

These stocks have withstood every possible event an investor can imagine. In contrast, the average holding time for securities in an average investor's portfolio is a mere six months!

Additionally, numerous investors entered the market at the peak of late 2021 and are now frustrated because, even after a year and a half, they have not yet recovered their initial investment.

The concept of patience seems to be lacking in the world of investing, especially among average investors. This starkly contrasts with Warren Buffett, whose strength lies in his remarkable time horizon: 34 years of holding certain stocks.

This extended timeframe has allowed Buffett to weather various market cycles and garner incredible returns.