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Buy not on optimism, but on arithmetic.

Benjamin Graham

By refusing to pay too much for an investment, you minimize the chances that your wealth will ever disappear or suddenly be destroyed.
BENJAMIN GRAHAM

Investing Pay Too Much
Every corporate security may be best viewed, in the first instance, as an ownership interest in, or a claim against, a specific business enterprise.
BENJAMIN GRAHAM

Firsts May Ownership
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
Those with the enterprise lack the money and those with the money lack the enterprise to buy stocks when they are cheap.
BENJAMIN GRAHAM

Cheap Enterprise Enterprises Investing Stock
Traditionally the investor has been the man with patience and the courage of his convictions who would buy when the harried or disheartened speculator was selling.
BENJAMIN GRAHAM

Investing Men Selling
Stock speculation is largely a matter of A trying to decide what B, C and D are likely to think-with B, C and D trying to do the same.
BENJAMIN GRAHAM

Matter Thinking Trying
The value of any investment is, and always must be, a function of the price you pay for it.
BENJAMIN GRAHAM

Investing Investment Pay
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.
BENJAMIN GRAHAM

Investing Long Safety
Investing isn’t about beating others at their game. It’s about controlling yourself at your own game.
BENJAMIN GRAHAM

Controlling Games Investing
Price statistics show clearly that instability in raw-material prices is a prime cause of instability of other prices.
BENJAMIN GRAHAM

Causes Materials Raw Statistics
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 enjoy a reasonable chance for continued better than average results, the investor must follow policies which are (1) inherently sound and promising, and (2) not popular on Wall Street.
BENJAMIN GRAHAM

Average Sound Wall
The volume of credit depends upon three factors: the desire to borrow, the ability to lend and the desire to lend.
BENJAMIN GRAHAM

Credit Desire Three
Nearly everyone interested in common stocks wants to be told by someone else what he thinks the market is going to do. The demand being there, it must be supplied.
BENJAMIN GRAHAM

Demand Thinking Want
While enthusiasm may be necessary for great accomplishments elsewhere, on Wall Street it almost invariably leads to disaster
BENJAMIN GRAHAM

Accomplishment Investing Wall
For 99 issues out of 100 we could say that at some price they are cheap enough to buy and at some price they would be so dear that they would be sold.
BENJAMIN GRAHAM

Investing Issue Issues Price Some
Do not let anyone else run your business
BENJAMIN GRAHAM

Anyone Buisness Else Running
Confusing speculation with investment is always a mistake.
BENJAMIN GRAHAM

Confusing Investing Mistakes
Instead of passing blithely over into that Promised Land, flowing almost literally with milk and honey, it may be our destiny to wander a full 40 years or more in the wilderness of doubt and divided sentiments.
BENJAMIN GRAHAM

Destiny Honey Milk Years
The market is always making mountains out of molehills and exaggerating ordinary vicissitudes into major setbacks.
BENJAMIN GRAHAM

Mountain Ordinary Vicissitudes
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
There is something paradoxical in the fact that by establishing an export market we subject our entire domestic production to the vagaries of that market.
BENJAMIN GRAHAM

Facts Paradoxical Subjects
Investing is most intelligent when it is most businesslike.
BENJAMIN GRAHAM

Intelligent Investing
The ideal form of common stock analysis leads to a valuation of the issue which can be compared with the current price to determine whether or not the security is an attractive purchase.
BENJAMIN GRAHAM

Analysis Determine Investing Issues Valuation
The beauty of periodic rebalancing is that it forces you to base your investing decisions on a simple, objective standard.
BENJAMIN GRAHAM

Decision Investing Simple
In the financial markets, hindsight is forever 20/20, but foresight is legally blind. And thus, for most investors, market timing is a practical and emotional impossibility.
BENJAMIN GRAHAM

Emotional Forever Investing
The qualitative factors upon which most stress is laid are the nature of the business and the character of the management. These elements are exceedingly important, but they are also exceedingly difficult to deal with intelligently.
BENJAMIN GRAHAM

Character Important Stress

Buy not on optimism, but on arithmetic.

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Buy not on optimism, but on arithmetic.

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