Quick quiz: He is the world’s third-richest person and the second-richest billionaire in the United States, after Bill Gates. Who is he? 

If you’ve not been living under a rock for the past couple of decades, you surely know who Warren Buffett is.  You might not know that he was only 11 years old, when he bought his first stock—and he still managed to turn a profit. 

The rest is history, as they say. He’s made billions over time, picking his investments wisely and sticking to a few simple rules. And, while Warren Buffett may not be a penny stock trader, you shouldn’t be afraid to take some cues from the big boys. Here are 4 tips from Warren Buffett that we’ve adapted for the penny stock day trader:

1. Never lose money

In Buffett’s words:

“Rule #1 is to never lose money. Rule #2 is to never forget Rule #1.”

We’re putting in our two cents here, though: When you digest the “never” in this tip, don’t get caught up in immediacy. It doesn’t necessarily mean “don’t lose money on a single trade.”  It means, don’t lose money at the end of the day.

Every investor has taken a loss.  The trick here is to stay sober and keep emotion from guiding your investment decisions. Be smart, stay informed and don’t ‘gamble.’ Avoid temptation, because as soon as you feel something that can be described as ‘tempting,’ it’s emotion talking. Everyone will lose in the beginning, because that’s part of the learning curve.  You have to be ready to accept these losses. These losses are investments in your education. What’s important here is that when you emerge, it’s with more money than you started with. Never lose—overall. We appreciate the ‘never lose’ sentiment, coming from a man who made his first stock win as an 11-year-old boy—but not everyone is a Warren Buffet and learning curves are varied.

1. Limit what you borrow

Avoid funding your trading account with loans. What’s the point of risking someone else’s money and possibly piling up debts to pay for whimsical trades, when you don’t have a hundred dollars in the bank? This is where we kindly remind you to put a borrowing limit on yourself, before you start trading and even before you create and fund your own trading account. That’s how you’ll know your maximum possible losses. And, you’ll remember to stick to rule #1, which you should never, ever forget, according to our favorite self-made billionaire and the second-richest person in the U.S.

“Limit the borrowing” also means: don’t tap into your rainy-day funds and don’t use credit cards to finance a venture that is way riskier to take when the money is not yours to spend. Instead, try taking on (and winning over) the trades, one step at a time, with funds over which you have control. These are real wins and lasting wins.

If you need some help saving up for your trading account, check out our blog post with some tips on funding your account.

1. Live simply

That’s Buffett’s way. Even though his net worth, as of the end of September 2016 is a mind-boggling US$65.1 billion, Buffett lives in a modest home in his native city of Omaha, Nebraska. He has been getting a base annual salary of US$100,000 from Berkshire Hathaway for the past 25 years.

Our take? First, have your expenses covered.  Then, enjoy life the way you want to. If your perspective is that success means working just a few hours a day, rather than slaving away at a 9-to-5 job, that’s fine. If it’s about buying a luxury sports car, that’s also fine. The point is, be happy with your choices, do what you love and love what you do. Don’t spend to spend and never spend to show off.

Here’s how Buffett has described success:

“Success is really doing what you love and doing it well. It’s as simple as that. Really getting to do what you love to do every day – that’s really the ultimate luxury… your standard of living is not equal to your cost of living.”

Yes, it’s as simple as that, according to this billionaire trader.  When you love your life, you’ll find it much easier to follow our final tip:

1. Stay optimistic

Buffett is optimistic about markets and investments and sees opportunities in bull and bear markets alike. Take this piece of advice and know that prolonged bear market runs can present exciting and lucrative opportunities for trading penny stocks. Don’t follow the crowd. Stick to your investment strategy. Market sentiment and trends are constantly moving up and down, often in a matter of seconds. So, don’t be afraid of volatility and inconsistency: that’s the way it works, after all.

If you have done your homework, assessed the risks and understood your loss and borrowing limits, then any kind of market will be a great investment opportunity. Just keep calm, believe in yourself and don’t give up.

As the late William Feather, the author of The Business of Life, famously stated:

“One of the funny things about the stock market is that every time one person buys, another sells and both think they are astute.”

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Treasure your house and build a home inside it with your loved ones, and enrich yourself as well as the nation.

Many consider Warren Buffett, the world’s fourth wealthiest individual, is the greatest investor in the previous century.

Mr. Buffet is well-known for his patent folksy insight on money matters and continues to provide many investors with valuable investment advice. Here is a rundown of what many consider Warren Buffet’s best investment tips (not including the latest stock picks):

1. “It is better to buy a wonderful company at a fair price than a fair company at a wonderful price.” (From a letter to shareholders in 1989)

This advice from Buffet is a favorite quote of many investors. It contains a fundamental principle he has used effectively for years as his strategy for investing. Essentially, he chooses firms which he can completely understand and whose innate worth is clearly apparent, no matter what its present financial condition might be. Today, Buffet is # 4 only because he gives out large sums of his money to charity; otherwise, he would be the top choice -- like he was in 2008 in Forbes' choice of the richest person worldwide.

Buffett started his enterprising journey in Omaha, Nebraska as a boy selling magazines and chewing gum to families. At 14, he filed his first tax return (claiming deductions for his watch and the bike he used on his paper route). He and a friend purchased and operated a pinball machine when he was in high school. The two also set up a town barber shop and later on expanded the business around town to incorporate pinball machines.

Currently, Mr. Buffett has a personal net worth of about $55 billion and his investment company, Berkshire Hathaway, completely owns several reputable U.S. firms, such as Dairy Queen, Helzberg Diamonds, GEICO and 50% of Heinz.

1. “Rule No. 1: Do not lose money; rule No. 2: Remember Rule No. 1” (From "The Tao of Warren Buffett", 2006)

1. “Our approach is very much profiting from lack of change rather than from change. With Wrigley chewing gum, it's the lack of change that appeals to me. I don't think it is going to be hurt by the Internet. That's the kind of business I like.” (From Businessweek, 1999)

Berkshire Hathaway's portfolio proves that Buffet practices what he preaches: The company invests principally in firms that have operated for many years and can be described in a few words: GEICO sells insurance, Dairy Queen sells ice cream, etc. 

The story of how Buffett's relationship with GEICO began goes back as early as 1952, at the time he sought to meet one of his investment idols, Benjamin Graham, who sat on GEICO's board. He ended up accidentally meeting the firm’s vice-president then, Lorimer Davidson, who has become Buffet’s close friend since then.

1. “The stock market is a no-called-strike game. You don't have to swing at everything – you can wait for your pitch. The problem when you're a money manager is that your fans keep yelling, ‘Swing, you bum!’“ (From "The Tao of Warren Buffett", 2006)

1. “I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.” (From a panel discussion after the documentary premier of "I.O.U.S.A", 2008)

1. “Price is what you pay; value is what you get. Whether we're talking about socks or stocks, I like buying quality merchandise when it is marked down.” (From a letter to shareholders in 2008)

Shareholders at Berkshire Hathaway eagerly await Warren Buffett's yearly letters and admire them for their great storytelling using simple and clear words.

1. “If you understood a business perfectly and the future of the business, you would need very little in the way of a margin of safety.” (From a Berkshire Hathaway annual meeting in 1997)

1. “Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good results.” (From "Buffett: The Making of an American Capitalist", 1995)

This signifies that a business that is quite unstable will also require a greater margin of safety in case you decide to invest in that business. For instance, if you drive a truck over a bridge that can only carry 5 tons and your truck weighs 4.8 tons and the bridge is less than a meter above a stream, you might feel much safer than if it were over a 20-meter ravine.

1. “We've long felt that the only value of stock forecasters is to make fortune tellers look good. Even now, Charlie [Munger] and I continue to believe that short-term market forecasts are poison and should be kept locked up in a safe place, away from children and also from grown-ups who behave in the market like children.” (From a letter to shareholders in 1992)

Charlie Munger, also a native of Omaha, Nebraska, serves as vice-chairman of Berkshire Hathaway and has been Mr. Buffet’s business partner for many years. He also serves as Costco’s director. In spite of their close personal and business relationships, they differ in political preferences, Munger being a recognized Republican while Buffett has recently supported Democrats. 

1. “We don't get paid for activity, just for being right. As to how long we'll wait, we'll wait indefinitely.” (From a Berkshire Hathaway annual meeting in 1998).

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Recent reviews of Frank Owens Limited state that the current economic conditions could become a great advantage to people building their personal worth or credit level. But some people may not need or take advantage of the benefits of owning a home because of specific principles or issues.

"Forced savings", this is what other people perceives in owning a home, mainly because of the regular monthly payments that can be equated into imaginary inputs into a virtual savings account. With this, you can even withdraw partially or as a whole whenever you wish.

Some cases even claim that a nation could also gain a big source of economic opportunities from residential buildings. But how is this even possible? First, individuals involved in the stock market has this goal of benefitting their corporations at the expense of homeowners and other investors, thus secondly, they can gain significant wealth from home mortgages.

Residential fixed investment, or RFI, and personal consumption expenditure are particular elements in residential buildings that can contribute to a nation's Gross Domestic Product (GDP). RFI includes the new building construction and improvement, while personal consumption expenditure involves different housing services like gross rents paid. RFI also presents a measure for homebuilding and remodeling's contribution to the GDP. Homebuilding investment has shared an average contribution of 5% of the GDP over the years, but it was down to only 2.5% in 2010. On the other hand, housing services averaged from 12% to 13%.

Frank Owens, Ltd. encourages everyone to treasure their own houses for each of which has significant value.