Undervaluations caused by neglect or prejudice may persist for an inconveniently long time, and the same applies to inflated prices caused by over-enthusiasm or artificial stimulants.
BENJAMIN GRAHAMThe volume of credit depends upon three factors: the desire to borrow, the ability to lend and the desire to lend.
More Benjamin Graham Quotes
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There is a close logical connection between the concept of a safety margin and the principle of diversification.
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Before you invest, you must ensure that you have realistically assessed your probability of being right and how you will react to the consequences of being wrong.
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The only thing you should do with pro forma earnings is ignore them.
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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.
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Real investment risk is measured not by the percent that a stock may decline in price in relation to the general market in a given period, but by the danger of a loss of quality and earnings power through economic changes or deterioration in management.
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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.
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Unusually rapid growth cannot keep up forever; when a company has already registered a brilliant expansion, its very increase in size makes a repetition of its achievement more difficult.
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It’s nonsensical to derive a price/earnings ratio by dividing the known current price by unknown future earnings.
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Whether we like it or not, government intervention in the face of surplus is here to stay.
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Knowledge is only one ingredient on arriving at a stock’s proper price. The other ingredient, fully as important as information, is sound judgment.
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Most businesses change in character and quality over the years, sometimes for the better, perhaps more often for the worse. The investor need not watch his companies’ performance like a hawk; but he should give it a good, hard look from time to time.
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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).
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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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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.
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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.
BENJAMIN GRAHAM