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 GRAHAMEvery corporate security may be best viewed, in the first instance, as an ownership interest in, or a claim against, a specific business enterprise.
More Benjamin Graham Quotes
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Diversification is an established tenet of conservative investment.
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The stock market resembles a huge laundry in which institutions take in large blocks of each others washing … without rhyme or reason.
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You must never delude yourself into thinking that you’re investing when you’re speculating.
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Though business conditions may change, corporations and securities may change, and financial institutions and regulations may change, human nature remains the same.
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Losing 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.
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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.
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Never buy a stock because it has gone up or sell one because it has gone down.
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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.
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The investor’s chief problem – and even his worst enemy – is likely to be himself.
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Buy not on optimism, but on arithmetic.
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THERE is widespread agreement among economists that abuse of credit constitutes one of the chief unwholesome elements in business booms and is mainly responsible for the ensuing crash and depression.
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In the short run, the market is a voting machine, but in the long run it is a weighing machine.
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Even defensive portfolios should be changed from time to time, especially if the securities purchased have an apparently excessive advance and can be replaced by issues much more reasonable priced.
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Never mingle your speculative and investment operations in the same account nor in any part of your thinking.
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If fees consume more than 1% of your assets annually, you should probably shop for another adviser.
BENJAMIN GRAHAM