Warrent Buffet warns investors to avoid US stocks

Mr Buffett, who has become known as the 'Sage of Omaha' for his hugely successful investment policy over the past few decades, told the BBC Radio 4's Today programme that anybody with money to invest should think twice before putting it into US shares.

He said: "It's tough because equity valuations, at least in the US, generally are fairly full and I would not advise somebody in the US that came in to some money right now, to rush right into the equity market."

What to buy?

The US market has roared to new highs in recent weeks - despite concerns that stock prices increasingly appear to bear little or no resemblance to the amount of money a company is actually making.

Asked just how expensive US companies were at the moment, Mr Buffett said: "Too expensive for me in virtually all cases."

Stock tips

The famous investor qualified his warning against private purchases of shares by saying that in the long-term equities would offer a healthy return.

"If they are going to own it for a very long period of time, equities are the place to be. But if many people, particularly if they haven't been in equities before, go in at a time like this and prices should go down they might start doubting their own judgement," he said.

He also had some advice for investors wondering which stock to pick.

He suggesting they should look to invest in businesses they understand and believe have good prospects and a strong management team. Then hold them for a long time - rather than bailing out when the share price wavers.

Mr Buffett believes holding on to stocks for 10 or 20 years was the secret to his investment success.

Hanging on his words

Mr Buffett is one of the few investors who regularly moves the world stock markets.

Investors have been keen to hear word from the head of the Berkshire Hathaway investment trust for some time.

Mr Buffett recently spread euphoria and surprise through commodities markets after he purchased 20% of world silver stocks.

Dealers have tried in vain to glean some information about his movements since then.

However, there have been some concerns that Mr Buffett has lost his golden touch recently. Analysts believe he lost a substantial amount of money having taken the wrong decision to invest heavily in US bonds.

Dancing to the market's tune

Nevertheless the 68 year-old Mr Buffet said he still loved what he was doing and had no intention of retiring.

"I love what I do. I tap dance to work every day - I can hardly wait to get there.