Warren Buffett: How to Invest in Stocks During Rising Interest Rates
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Warren Buffett on how to invest during rising interest rates. Investing during a period of rising interest rates is an extremely topical when it comes to investing in the stock market given how the Fed is raising interest rates. In the words of Warren Buffett, interest rates act like gravity on stocks. As interest rates rise, stock prices fall. This is because the intrinsic value of a stock is based on the cash that stock will generate discounted back to the present day using a discount rate. As interest rates increase, that decreases the present value of those cash flows.
If you enjoyed this video on how to invest in stocks during rising interest rates, make sure to check out another investing and Warren Buffett video you may like: Warren Buffett: How to make money during inflation – https://www.youtube.com/watch?v=8GNEgMzzr40
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