On the Money

Warren Buffett: Buy, hold and don't watch too closely

Warren's Wisdom
Warren's Wisdom

If investors are worried about their retirement savings after watching 2016's wild market fluctuations, Warren Buffett has some advice.

"I would tell them don't watch the market closely," the Oracle of Omaha said. The billionaire and philanthropist who has amassed a fortune of more than $64 billion tells CNBC's "On The Money" that buy-and-hold is the best strategy.

"The money is made in investments by investing," Buffett said in a recent interview, "and by owning good companies for long periods of time. If they buy good companies, buy them over time, they're going to do fine 10, 20, 30 years from now."

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Despite a whipsaw market unnerved by everything from China's economy to the Federal Reserve's interest rate policy warns individual investors against making a lot of stock moves with their portfolio.

"If they're trying to buy and sell stocks, and worry when they go down a little bit … and think they should maybe they should sell them when the go up, they're not going to have very good results," Buffett said.

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Now in his 51st year of leading Omaha-based conglomerate Berkshire Hathaway, Buffett is frequently ranked among the world's wealthiest men, which include Microsoft's founder Bill Gates and Mexican entrepreneur Carlos Slim Helu.

Berkshire Hathaway owns more than 80 businesses, including household staples like Dairy Queen, GEICO, Fruit of the Loom and Benjamin Moore. The conglomerate also has major stakes in giants like IBM, , Coca-Cola and Kraft Heinz.

In looking for companies to invest in, Buffet used the following example: "If you had a chance to buy into a good company in your hometown … and you knew it was a good company and knew good people were running it, and you bought in at a fair price, you wouldn't want to get a quote every day."

Instead of frequently checking a stock's price, "you'd look to the earnings and dividends over the years as determining whether you made a good investment or not. And that's what people should do with stocks."

Publicly traded shares are "little pieces of businesses. And the businesses are generally pretty darn good."

'Surprised' by Trump surge

Warren Buffett
Adam Jeffery | CNBC

Buffett, who has publicly supported Democratic contender Hillary Clinton, weighed in on the contentious 2016 race for the Republican nomination. Buffett told CNBC he was "very surprised" by Donald Trump's showing in the presidential race.

He quoted Charlie Munger, his Berkshire Hathaway vice chairman, in explaining Trump's surge. "My partner, Charlie, says, 'Never underestimate the man who overestimates himself,' " Buffett said. "You see a lot of that in business and sometimes you see it in politics, too."

Trump, who has amassed the most primary wins and delegates despite a sustained assault from fellow GOP members, "appeals to a big segment of the people that turn out in a Republican primary," Buffett said — a fact that has left the billionaire "totally surprised."

For the first time, next month's Berkshire Hathaway annual meeting in Omaha will be broadcast live on Yahoo. "If you're in a business and your managing partners are 92, which Charlie (Munger) is, and 85, which I am, you probably ought to get a chance to see them," Buffett joked.

He said the webcast will give people an opportunity to get a look at the executive tandem in action without traveling to Nebraska.

"We'll be on for six hours. People can decide whether we really should be cutting out paper dolls or running Berkshire," he added.

"On the Money" airs on CNBC Saturday at 5:30 a.m. ET, or check listings for air times in local markets.