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 GRAHAMIn 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.
More Benjamin Graham Quotes
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High valuations entail high risks.
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Nothing important on Wall Street can be counted on to occur exactly in the same way as it happened before.
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Confusing speculation with investment is always a mistake.
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Buy not on optimism, but on arithmetic.
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The intelligent investor should recognize that market panics can create great prices for good companies and good prices for great companies.
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Both individual skill (art) and chance are important factors in determining success or failure.
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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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… the loss of public confidence in the financial community growing out of its own conduct in recent years. I insist that more damage has been done to stock values and to the future of equities from inside Wall Street than from outside Wall Street.
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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.
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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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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.
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While enthusiasm may be necessary for great accomplishments elsewhere, on Wall Street it almost invariably leads to disaster
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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.
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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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At heart, “uncertainty” and “investing” are synonyms.
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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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The investor’s primary interest lies in acquiring and holding suitable securities at suitable prices.
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Always remember that market quotations are there for convenience, either to be taken advantage of or to be ignored.
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The people of the United States will not tolerate another deep depression that arises not from any lack of natural resources, productive capacity or man and brain power, but solely from imperfections in the functioning of the system of finance capitalism.
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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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Avoid second-quality issues in making up a portfolio unless they are demonstrable bargains.
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It must be fundamentally wrong to reduce production of food and fiber while one-third of our population is still ill fed and ill clothed.
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The genuine investor in common stocks does not need a great equipment of brain and knowledge, but he does need some unusual qualities of character
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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.
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Successful investing professionals are disciplined and consistent and they think a great deal about what they do and how they do it.
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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.
BENJAMIN GRAHAM