Warren Buffett has a famous saying; "Buy on the bad news". And, true to his word he has been buying. He recently invested $5 billion into Goldman Sachs and $3 billion into GE restoring much needed confidence in these companies.

Buffett looks for the highest quality companies and seeks to buy them at a price much lower than their intrinsic value. By doing just this he has built a multi-billion dollar fortune and is regarded as one of the world's greatest investors.

Ask yourself when, in the last few years, have we had such bad news concerning the stock markets around the world? We see endless graphical representations of stock prices tumbling as panic stricken investors cut there losses.

However, the key here is that human emotion is driving stock prices down. This does not mean that many of the companies represented by the various stock markets are performing any worse. It does not mean that a great management team has suddenly become a bad management team overnight. It does not mean a great business model has become a bad business model. It just means the company's stock price is lower. So, the obvious question is; when you have a great company with a great management team and a great business model and that company is going cheap, isn't it a good idea to buy it?

Of course, most of us do not have the time or cash to take advantage of these rare opportunities. But the Mutual Fund managers do!

Find a good quality mutual fund with a good track record and an investment strategy matching Buffets. Start investing now, even if it is only $100 per month into an RRSP. You will reap the rewards in the long run.

Author: Mick McCafferty