I'd listen to Warren Buffett to grow my wealth with ASX shares

When it comes to investing in ASX shares, you could do a lot worse than listen to the advice of the Oracle of Omaha, Warren Buffett. Over almost six decades now, the legendary investor’s Berkshire Hathaway (NYSE: BRK.B) business has smashed the market with some mind-boggling returns. In fact, Buffett’s most recent letter to shareholders reveals that the conglomerate’s book value per share has grown by an average of double the stock market return since 1965.

And that’s not because the stock market has delivered pitiful returns. Far from it! The S&P 500 index has generated an average return of 9.9% per annum since 1965.

It’s just that Buffett has found a way to achieve a return of 19.8% per annum over the same period. So, what’s the secret to Buffett’s success? Well, the good news is that there isn’t a secret and anyone can follow his investment style.

Investing like Buffett with ASX shares

While Buffett is well-known for loving a bargain, his focus is more on quality than how cheap something looks.

He once explained:

It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.

But what makes a company wonderful and how can we find ASX shares with these qualities? Buffett believes sustainable competitive advantages, or moats, are of the utmost importance when investing. In his 2007 letter to shareholders, he explained:

A truly great business must have an enduring ‘moat’ that protects excellent returns on invested capital.

The dynamics of capitalism guarantee that competitors will repeatedly assault any business ‘castle’ that is earning high returns. Therefore a formidable barrier such as a company’s being the low-cost producer (GEICO, Costco) or possessing a powerful world-wide brand (Coca-Cola, Gillette, American Express) is essential for sustained success. Business history is filled with ‘roman candles’, companies whose moats proved illusory and were soon crossed.

Where to find moats on the ASX?

There are a number of ASX shares that have moats.

These include toll road operator Transurban Group (ASX: TCL), realestate.com.au owner REA Group Limited (ASX: REA), and biotherapeutics giant CSL Limited (ASX: CSL). There’s also the Buffett-inspired VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT) to consider, which only invests in companies with moats. And if you need any more proof that following Buffett’s advice could be the smart thing to do, you only need to look at this ETF’s returns.

Over the last decade, the index it tracks has generated an average return of 18.64% per annum.

That would have turned a £10,000 investment into approximately £55,000 over the 10 years.

aligne listed on couponmatrix.ukgap listed on couponmatrix.ukkally-sleep listed on couponmatrix.uksmol listed on couponmatrix.ukstreethub listed on couponmatrix.ukvivienne-westwood listed on couponmatrix.uk
aligne listed on couponmatrix.ukFrom breezy organic cotton to soft LENZING™ ECOVERO™ viscose, Aligne is leading the charge toward chic, sustainably sourced women’s clothing. With an eye toward design that’s as forward-thinking as their fabrics, there’s no saying what head turning styles an Aligne discount code can add into your wardrobe for less. Believing in fashion without compromise that’s built on a planet-friendly foundation, Aligne is the ideal outlet for any environmentally-aware customer.
gap listed on couponmatrix.ukGap have a fun range of fashion that gives shoppers quality clothing options whatever their style preference is. Gap’s line of clothing is suited to everyone searching for subtle style, with clothes for men, women and kids that make you stand out from the crowd at affordable prices. When Gap launched, they revolutionised the way people across America styled themselves and this revolution made its way throughout the rest of the world, with Gap’s UK stores now a staple of the high street. Shoppers are drawn to Gap for the unique simplicity of their range which includes jeans, t-shirts and shoes, and now with your Gap discount codes you get the best deals possible on their fantastic selection of products.
kally-sleep listed on couponmatrix.ukLet your tumultuous nights become a thing of the past with Kally Sleep, the pillow and bedding experts who design specialist sleeping aids to address everything from pregnancy to sports recovery. With an inventory capable of tackling any sleep disruption you may have, all you’ll need is a Kally Sleep discount code to get yourself well-rested on a budget. Regardless of if you suffer back pain, anxiety or sleep awkwardly, trust Kally Sleep to provide the solution.
smol listed on couponmatrix.ukSometimes the best things come in small packages, and that certainly applies to smol – the planet-friendlier and cruelty free formula whose ethical standards are matched only by their cleaning quality. Make full use of a smol discount code today to save on a monthly delivery service that sends a tailored number of cleaning capsules to your door every month, removing one more thing from your shopping list as well as all the stains from your clothes!
streethub listed on couponmatrix.ukWhen you feel like giving your home and lifestyle the upgrade it deserves, or if you want a new look, you can count on Trouva’s curated catalogue for endless beautiful finds. Think contemporary and chic vibes across everything, - from Trouva cushions to coffee cups - as when you embark on an epic shopping journey with Trouva, you will be sure to find the perfect item(s) to suit you and your budget. Groupon loves a little luxury, so pick up a Trouva discount code today and bring your wishlist to life for less.
vivienne-westwood listed on couponmatrix.ukIf you know Vivienne Westwood, you know runway fashion. Making headway since she exploded onto the punk and new wave scene in the 1970s, Vivienne Westwood has evolved along with the trends to deliver cutting-edge designer clothing for over 40 years. With the help of a Vivienne Westwood discount code, you and your wardrobe can get acquainted with the fashionista’s distinct flair for hundreds less, adding styles that get only better and more collectable with age.