How Warren Buffett’s ‘LeBron James Analogy’ Could Make You A Fortune

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As for LeBron, he’s become more particular as well. As one of the world’s most recognizable and marketable faces, he must be besieged by companies trying to catch his attention. But not just anyone makes the grade.

He has had endorsement deals with NIKE, Inc. (NYSE:NKE), The Coca-Cola Company (NYSE:KO), Samsung and others that, according to Forbes, helped him earn $60 million between June of 2012 and June of 2013. And in 2011, he even became a minority owner in Liverpool FC, the English Premier League soccer team.

“I’ve got a lot going on right now,” James said in the same Miami Herald article. “I’m not looking for too many new opportunities — unless it’s a good one.”

Sounds like a sensible decision. I have a feeling that his friend, Mr. Buffett, would approve.

Action to Take –> It can be dangerous to put all of your money in one stock or just few stocks. After all, if that stock tanks, your portfolio goes down with it.

However, the idea of putting the bulk of your funds into your strongest stocks can make sense, if you do your homework. And since you likely don’t have the resources at your disposal that James and Buffett do, the responsibility falls onto your shoulders. Take it seriously.

Learn as much as you can about these companies before you throw all of your money at them. Read annual reports, quarterly reports and any other data you can get your hands on. Check the news for the latest headlines about the company. Talk to friends who may have ties to the firm or who may already own the stock. Turn over every rock and beat every bush. After all, while investing a lot of money in a wonderful company is a great idea, researching it is the only way to know just how wonderful the company really is.

This article was originally written by Matt Schulz and posted on StreetAuthority.

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