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The chief losses to investors come from the purchase of low-quality securities at times of favorable business conditions.

Benjamin Graham

To have a true investment, there must be a true margin of safety. And a true margin of safety is one that can be demonstrated by figures, by persuasive reasoning, and by reference to a body of actual experience.
BENJAMIN GRAHAM

Body Investment Safety
Thus the important and difficult part of sound investment, which hinges upon the investor’s own temperament and attitude, is not much affected by the passing years.
BENJAMIN GRAHAM

Affected Investment Passing Temperament Years
The market is a pendulum that forever swings between unsustainable optimism (which makes stocks too expensive) and unjustified pessimism (which makes them too cheap). The intelligent investor is a realist who sells to optimists and buys from pessimists.
BENJAMIN GRAHAM

Intelligent Optimism Swings
The investor who permits himself to be stampeded or unduly worried by unjustified market declines in his holdings is perversely transforming his basic advantage into a basic disadvantage.
BENJAMIN GRAHAM

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

Earning Investing Ratios
Speculative stock movements are carried too far in both directions, frequently in the general market and at all times in at least some of the individual issues.
BENJAMIN GRAHAM

Investing Issues Movement
The intelligent investor shouldn’t ignore Mr. Market entirely. Instead, you should do business with him- but only to the extent that it serves your interests.
BENJAMIN GRAHAM

Intelligent Investing Should
Successful investment may become substantially a matter of techniques and criteria that are learnable, rather than the product of unique and incommunicable mental powers.
BENJAMIN GRAHAM

Successful Technique Unique
The investor’s primary interest lies in acquiring and holding suitable securities at suitable prices.
BENJAMIN GRAHAM

Interest Lying Market Timing
The purpose of this book is to supply, in the form suitable for laymen, guidance in the adoption and execution of an investment policy.
BENJAMIN GRAHAM

Adoption Book Purpose
Calculate a stock’s price/earnings ratio yourself, using Graham’s formula of current price divided by average earnings over the past three years.
BENJAMIN GRAHAM

Average Current Past Price Years
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
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.
BENJAMIN GRAHAM

Achievement Forever Growth
We have not known a single person who has consistently or lastingly make money by thus “following the market”. We do not hesitate to declare this approach is as fallacious as it is popular.
BENJAMIN GRAHAM

Approach Investing Making Money
If fees consume more than 1% of your assets annually, you should probably shop for another adviser.
BENJAMIN GRAHAM

Assets Fees Investing
Rather should we say that the market is a voting machine, whereon countless individuals register choices which are the product partly of reason and partly of emotion.
BENJAMIN GRAHAM

Countless Emotion Party Rather

The chief losses to investors come from the purchase of low-quality securities at times of favorable business conditions.

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The chief losses to investors come from the purchase of low-quality securities at times of favorable business conditions.

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