I'll sunrise you by saying the Buffett method won't be a home run for most people, although it will CERTAINLY work out better than "playing" pennies.
Buffett is a brainy guy with great connections and savvy associates. Moreover Buffett gets deals that aren't available to most of us, like his recent preferred stock deal with Bank of America. (as we've seen so far, he doesn't always win)
But his biggest advantage--one that's almost unique to him--is his army of followers, many of whom control fortunes. To some degree almost everyone on Wall Street (and far beyond) watches him for clues. George Soros has the same advantage. Maybe two or three others do.
My own stock money has mostly been in index funds for many years. Buffett himself has spoken well of index funds. I make no attempt to beat the market because I know ***I*** can't do it. John Bogle, the founder of The Vanguard Group, says very, very few people beat the S&P 500 for long.
I make no attempt to TIME the market because I (and Buffett) know that NO ONE can do it. I KNOW that most investors, even fairly experienced ones tend to buy at peaks and sell at bottoms. Buffett would agree. University studies suggest that to be the case.
For years my money has been in a roughly 50/50 mix of index funds (and a few blue chips for tax reasons) and bonds... in my case mostly muni bonds. I don't sell stocks except for tax-loss advantages.
For the past decade or more, that simple method has probably beaten 99% of IHUBers and 80-90% of other investors including many pros. Even during the dot com days of the 90s I probably did better than most investors. And my heavy bond component not only helps the investment returns, but it provides for much better nights' sleep.
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