So I've been thinking about Warren Buffett's investment rule lately, and honestly, it's way simpler than most people make it out to be. The guy's been crushing it with Berkshire Hathaway for decades, and his approach basically comes down to three things that even newer investors can actually follow.

First thing: find companies that are actually good. I know that sounds obvious, but what does 'good' really mean? Buffett's mentor Benjamin Graham had a solid take on this - look for companies paying dividends that have been growing consistently for years. Like, we're talking at least 10 years of steady dividend increases if you're just starting out. If you want to be extra selective, check out the Dividend Kings - these are companies that have raised dividends every single year for 50+ years straight. That's not luck, that's a business that actually works.

Once you've narrowed things down, dig into what the company actually does. Read their quarterly earnings reports, listen to the calls, check the annual report. You want to understand the business well enough that you're comfortable holding it for decades. That's the key mindset shift - we're not talking about trading here.

Second part of the warren buffett investment rule is pricing. This is where a lot of people get lost, but there's a shortcut. For dividend stocks, just watch the yield. When a stock's dividend yield hits historically high levels, it usually means the price is attractive. You can double-check this by looking at price-to-sales and price-to-book ratios - just make sure most of them are pointing the same direction.

Let me give you a real example: PepsiCo and Walmart are both Dividend Kings. PepsiCo's sitting at a 3.8% yield right now, which is high for them historically - that looks cheap. Walmart's at 0.9%, which is low for them - that looks expensive. The other metrics confirm it.

Here's the thing though, and this is probably the most important part of the warren buffett investment rule: you have to actually hold these things long-term. I mean decades, not months or even years. Buffett's whole game is riding the long-term growth of the businesses he owns. That's how wealth actually builds.

One more thing I'd mention - Buffett thinks investors should only own a small number of stocks in their entire lives, maybe 20 or less. The idea is to force yourself to really think hard about what you're buying and stop you from constantly trading. Build your portfolio slowly over years, not days.

The warren buffett investment rule isn't complicated, and that's kind of the point. Good companies, fair prices, long holds. It's boring, but boring tends to work in the market.