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In the short-run, the market is a voting machine – reflecting a voter-registration test that requires only money, not intelligence or emotional stability – but in the long- run, the market is a weighing machine.

Benjamin Graham

It’s nonsensical to derive a price/earnings ratio by dividing the known current price by unknown future earnings.
BENJAMIN GRAHAM

Earning Investing Ratios
The market is always making mountains out of molehills and exaggerating ordinary vicissitudes into major setbacks.
BENJAMIN GRAHAM

Mountain Ordinary Vicissitudes
You must never delude yourself into thinking that you’re investing when you’re speculating.
BENJAMIN GRAHAM

Investing Speculating Thinking
Many progressive economists insist that gold is now in essentially the same position as silver and that the arguments the simon-pure gold advocates use against the white metal can be directed with equal effect against their own fetish.
BENJAMIN GRAHAM

Arguments Gold Use White
A defensive investor can always prosper by looking patiently and calmly through the wreckage of a bear market.
BENJAMIN GRAHAM

Bears Investing Wreckage
Why should the cotton growers suffer if there is shortage of wheat?
BENJAMIN GRAHAM

Cotton Suffering Wheat
Have the courage of your knowledge and experience. If you have formed a conclusion from the facts and if you know your judgment is sound, act on it – even though others may hesitate or differ.
BENJAMIN GRAHAM

Conclusion Facts Judgment May Sound
An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return.
BENJAMIN GRAHAM

Analysis Promise Safety
Most of the time common stocks are subject to irrational and excessive price fluctuations in both directions as the consequence of the ingrained tendency of most people to speculate or gamble… to give way to hope, fear and greed.
BENJAMIN GRAHAM

Hope Money Time
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
The intelligent investor should recognize that market panics can create great prices for good companies and good prices for great companies.
BENJAMIN GRAHAM

Intelligent Investing Panic
No matter how careful you are, the one risk no investor can ever eliminate is the risk of being wrong. Only by insisting on what Graham called the “margin of safety” – never overpaying, no matter how exciting an investment seems to be – can you minimize your odds of error.
BENJAMIN GRAHAM

Errors Odds Safety
A stock is not just a ticker symbol or an electronic blip; it is an ownership interest in an actual business, with an underlying value that does not depend on its share price.
BENJAMIN GRAHAM

Ownership Share Trouble Value
It is no difficult trick to bring a great deal of energy, study, and native ability into Wall Street and to end up with losses instead of profits. These virtues, if channeled in the wrong directions, become indistinguishable from handicaps.
BENJAMIN GRAHAM

Energy Loss Wall
Price fluctuations have only one significant meaning for the true investor. They provide him with an opportunity to buy wisely when prices fall sharply and to sell wisely when they advance a great deal.
BENJAMIN GRAHAM

Fall Investing Opportunity
Thousands of people have tried, and the evidence is clear: The more you trade, the less you keep.
BENJAMIN GRAHAM

Evidence Investing People

In the short-run, the market is a voting machine – reflecting a voter-registration test that requires only money, not intelligence or emotional stability – but in the long- run, the market is a weighing machine.

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In the short-run, the market is a voting machine – reflecting a voter-registration test that requires only money, not intelligence or emotional stability – but in the long- run, the market is a weighing machine.

Related Topics

Popular Authors

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