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If you are shopping for common stocks, choose them the way you would buy groceries, not the way you would buy perfume.

Benjamin Graham

Confronted with a challenge to distill the secret of sound investment into three words, we venture the motto, Margin of Safety.
BENJAMIN GRAHAM

Challenges Intelligent Safety
In an ideal world, the intelligent investor would hold stocks only when they are cheap and sell them when they become overpriced, then duck into the bunker of bonds and cash until stocks again become cheap enough to buy.
BENJAMIN GRAHAM

Ducks Intelligent Investing
The intelligent investor is a realist who sells to optimists and buys from pessimists.
BENJAMIN GRAHAM

Intelligent Investing Realist
People who invest make money for themselves; people who speculate make money for their brokers. And that, in turn, is why Wall Street perennially downplays the durable virtues of investing and hypes the gaudy appeal of speculation.
BENJAMIN GRAHAM

Hype People Wall
We define a bargain issue as one which, on the basis of facts established by analysis, appears to be worth considerably more that it is selling for.
BENJAMIN GRAHAM

Analysis Investing Issues
To see how much a company is truly earning on the capital it deploys in its businesses, look beyond EPS to Return on Invested Capital (ROIC).
BENJAMIN GRAHAM

Investing Looks Return
Good managements produce a good average market price, and bad managements produce bad market prices.
BENJAMIN GRAHAM

Average Good Man Management
The utility, or intrinsic value of gold as a commodity is now considerably less than in the past; its monetary status has become extraordinarily ambiguous; and its future is highly uncertain.
BENJAMIN GRAHAM

Commodity Gold Past
Never mingle your speculative and investment operations in the same account nor in any part of your thinking.
BENJAMIN GRAHAM

Investing Investment Thinking
Knowledge is only one ingredient on arriving at a stock’s proper price. The other ingredient, fully as important as information, is sound judgment.
BENJAMIN GRAHAM

Arriving Important Sound
It is worth pointing out that assuredly not more than one person out of a hundred who stayed in the market after after 1925 emerged from it with a net profit and that the speculative losses taken were appalling.
BENJAMIN GRAHAM

Hundred Loss Taken
The Reservoir system will function not only as an equalizer of business conditions, but also as a national store to meet further emergencies, such as war and drought, and-most important of all-as the concrete means of developing a steadily higher living standard for all.
BENJAMIN GRAHAM

Important Mean War
When somebody asserts that a stock has an earning power of so much, I am sure that the person who hears him doesn’t know what he means, and there is a good chance that the man who uses it doesn’t know what it means.
BENJAMIN GRAHAM

Earning Mean Men Power Sure Use
I am no longer an advocate of elaborate techniques of security analysis in order to find superior value opportunities.
BENJAMIN GRAHAM

Opportunity Order Technique
Experience teaches that the time to buy stocks is when their price is unduly depressed by temporary adversity. In other words, they should be bought on a bargain basis or not at all.
BENJAMIN GRAHAM

Adversity Should Teach
To establish the right price for a stock, the market must have adequate information, but it by no means follows that is the market has this information it will thereupon establish the right price.
BENJAMIN GRAHAM

Adequate Information Mean

If you are shopping for common stocks, choose them the way you would buy groceries, not the way you would buy perfume.

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If you are shopping for common stocks, choose them the way you would buy groceries, not the way you would buy perfume.

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