Never mingle your speculative and investment operations in the same account nor in any part of your thinking.
BENJAMIN GRAHAMLosing some money is an inevitable part of investing, and there’s nothing you can do to prevent it. But to be an intelligent investor, you must take responsibility for ensuring that you never lose most or all of your money.
More Benjamin Graham Quotes
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In other words, the market is not a weighing machine, on which the value of each issue is recorded by an exact and impersonal mechanism, in accordance with its specific qualities.
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The modern world is not geared properly to the storage of goods.
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The intelligent investor gets interested in big growth stocks not when they are at their most popular – but when something goes wrong.
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The investor who permits himself to be stampeded or unduly worried by unjustified market declines in his holdings is perversely transforming his basic advantage into a basic disadvantage.
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The intelligent investor should recognize that market panics can create great prices for good companies and good prices for great companies.
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The Reservoir plan is an engineering mechanism applied to the field of economics, and in its essence it has nothing to do with democracy or any other political philosophy.
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The market is a pendulum that forever swings between unsustainable optimism (which makes stocks too expensive) and unjustified pessimism (which makes them too cheap). The intelligent investor is a realist who sells to optimists and buys from pessimists.
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The sillier the market’s behavior, the greater the opportunity for the business like investor.
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The investor should be aware that even though safety of its principal and interest may be unquestioned, a long term bond could vary widely in market price in response to changes in interest rates.
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It is a misfortune of the times that all of us must needs be amateur economists-including, and perhaps especially, the professionals.
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The essence of investment management is the management of risks, not the management of returns.
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We urge the beginner in security buying not to waste his efforts and his money in trying to beat the market. Let him study security values and initially test out his judgment on price versus value with the smallest possible sums.
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Even the most conservative must realize that the recent transformation of surplus from an individual to a national disaster implies a scathing indictment of our capitalist system as it has now developed.
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Calculate a stock’s price/earnings ratio yourself, using Graham’s formula of current price divided by average earnings over the past three years.
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Avoid second-quality issues in making up a portfolio unless they are demonstrable bargains.
BENJAMIN GRAHAM