The 100+ Most Intelligent Value Investing Quotes of All Time 

Chris Lee Susanto, Founder at Re-ThinkWealth.com

First published on 16 November 2018 (Last updated on 4 April 2021)

The 100+ Most Intelligent Investing Quotes of All Time, Best investing quotes, re-thinkwealth.com Image Source: TheStreet.com

“Invest for the long haul. Don’t get too greedy and don’t get too scared.” – Shelby M.C. Davis

This list summarizes 100+ of the best investing quotes (and most intelligent) of all time.

They are spoken from some of the best value investing minds in the industry that I have modeled after for my value investing philosophy.

Both that have passed away (Benjamin Graham) and those that are still with us today.

Feel free to bookmark this page because this list will constantly be updated.

Quote by Shelby Cullom Davis

“You make most of your money in a bear market, you just don’t realize it at the time.”

I think it is apt to start with this quote because a value investor’s best opportunities are those that can allow him to buy quality businesses at a discount.

See also: Our free investing telegram channel to be the first to be notified of our next article.

On Patience and Long Term Orientation in Stock Investing

“The longer you’re willing to hold, the less crowded the opportunities are.” Richard Perry

“We like to hold names for long periods of time; five, seven, ten years; because that is where you can exploit inefficiencies in the market.” Paul Black

“The inability of so many investors and managers to invest with a long term horizon creates the opportunity for time arbitrage – an edge in an investing approach that requires the commitment to long-term holding periods.” Joel Greenblatt

“Time arbitrage – taking advantage of the opportunity for long-term profit offered when short-term investors sell due to disappointing short-term macro or business progress – has been a major source of profitability at Pershing Square since the inception of the firm.” Bill Ackman

“I think the key for us is to mantain our core philosophy of long-term investing. As long as we still believe in our position, we won’t let the markets change our mind.” Chris Hohn

“The wider market obsesses about short-term issues: sentiment, quarterly news flow and economic cycles. We think what counts in the long term are societal and technological changes (the megatrends mentioned above), the attitudes of management teams and the culture of the businesses we invest in.” Baillie Gifford

“Over the last few decades, investors’ timeframes have shrunk. They’ve become obsessed with quarterly returns. In fact, technology now enables them to become distracted by returns on a daily basis, and even minute-by-minute. Thus one way to gain an advantage is by ignoring the ‘noise’ created by the manic swings of others and focussing on the things that matter in the long term.” Howard Marks

“If you can invest with a three-to five-year horizon, which is a pretty difficult thing to do—it might sound like it’s an easy thing to do if market conditions are benign, but you throw a 2008 or a 2009 in there and you have to really work hard to remember that this is temporary and that you need to keep on looking out three to five years when you’re making these decisions. Ultimately, that, I think, is an incredibly powerful advantage. And the people that are on the quarter-to-quarter timeframe, they’re going to lose almost certainly. And they’re definitely going to be losing to the managers that are using the three- to five-year horizon. So I do know that it’s possible to extend your time horizon and succeed.” David Swenson

“In a sense, value investing is a large-scale arbitrage between security prices and underlying business value.” Seth Klarman

“It is just appalling the nerve strain people put themselves under trying to buy something today and sell it tomorrow. It’s a small-win proposition. If you are a truly long-range investor, of which I am practically a vanishing breed, the profits are so tremendously greater.” Phil Fisher

“The longer you can extend your time horizon the less competitive the game becomes, because most of the world is engaged over a very short time frame.” William Browne

“Be patient and resist the temptation to shorten your time horizon. To quote a good friend and mentor in the investment business, John Griffin, ‘When everyone is compressing their time horizon, you should lengthen yours.’ In late 2008 and early 2009, we made the regrettable mistake of selling good growth companies based on the deteriorating economy because we thought we could time our re-entry at better prices. Good risk management is essential in allowing for greater patience.” Chase Coleman

“We are in the arbitrage business, but not in the traditional merger arbitrage sense of the term. We engage in time arbitrage. We tend to buy early, average down, and then wait until our thesis is proven correct, and then we exit. This can happen quickly or it may take years.” Steven Romick

“The vast majority of people compete in a time horizon that’s very near dated. There are many fewer investors who are thinking out a decade and beyond.” Matthew McLennon

“Instead of focusing on the next quarter, investors need to focus on the next decade.” Stephen Paice

“My horizon is 10 to 15 years on average, and at least 5 years.” Bill Stewart

“We own stocks based on what we believe investors should be willing to pay for them five to seven years from now.” Bill Nygren

“The advantage we have is time frame. When I came into the business the average holding period for a mutual fund was seven years. Today it’s less than nine months.” Rob Rodriguez

“If you look carefully, almost all Old Money secrets can be traced to a single source: a longer-term outlook.“ Bill Bonner

“Greenlight believes the traditional investment horizon is too short because equities are long, if not indefinite duration assets. When we make an investment, we usually don’t have any idea how long we will be invested. If the downside of an opportunity is no short-term return or ‘dead money’, we can live with that. We are happy to hold for more than a year before succeeding. In practice, some “dead money” opportunities work out more quickly than we expect. A portfolio where some investments work quickly, some work more slowly, and the rest retain their value generates exciting results.” David Einhorn

Quote by John Maynard Keynes

“The markets are moved by animal spirits, and not by reason.”

“If farming were to be organised like the stock market, a farmer would sell his farm in the morning when it was raining, only to buy it back in the afternoon when the sun came out.”

“In the long run, we are all dead.”

“There is no harm in being sometimes wrong – especially if one is promptly found out.”

“Successful investing is anticipating the anticipations of others.”

“Markets can remain irrational longer than you can remain solvent.”

“When my information changes, I alter my conclusions. What do you do, sir?”

“The importance of money flows from it being a link between the present and the future.”

“The difficulty lies not so much in developing new ideas as in escaping from old ones.”

“Once doubt begins it spreads rapidly.”

“It is better to be roughly right than precisely wrong.”

Quote by Michael Burry

“Investors should own a concentrated portfolio of high-quality businesses that can deliver strong organic growth even if the economy falters.”

“My weapon of choice as a stock picker is research; it’s critical for me to understand a company’s value before laying down a dime. I really had no choice in this matter, for when I first happened upon the writings of Benjamin Graham, I felt as if I was born to play the role of value investor. All my stock picking is 100% based on the concept of a margin of safety, as introduced to the world in the book “Security Analysis,” which Graham co-authored with David Dodd. By now I have my own version of their techniques, but the net is that I want to protect my downside to prevent permanent loss of capital. Specific, known catalysts are not necessary. Sheer, outrageous value is enough.

My strategy isn’t very complex. I try to buy shares of unpopular companies when they look like road kill, and sell them when they’ve been polished up a bit. Management of my portfolio as a whole is just as important to me as stock picking, and if I can do both well, I know I’ll be successful.”

Quote by Mohnish Pabrai

“My only competitive advantage is patience and slightly superior analytics on the same information that everyone else receives. So far that’s worked out fine and we think it will work out in the future as well.”

“Charlie Munger says: ‘you don’t make money when you buy a stock, you don’t make money when you sell a stock, you make money by being patient and you make money by waiting’. Waiting for the right pitch, and then waiting for that pitch to kind of mature and develop. The single most important skill set that you can bring to value investing is patience. You have to have a temperament where you’re very happy watching paint dry. I would say that is the most difficult thing for investors and you can trade lot of IQ points for patience. You don’t need a lot of IQ points but you need a lot of patience. That’s the piece that usually gets missed.”

“The single most important skill for being a good investor is to be very content with not doing anything for extended periods and that’s perfectly fine.”

“Charlie Munger considers that a portfolio of four stocks is a well diversified portfolio. He says, you don’t even need a 5th stock. He goes on to say that if you lived in a small town, and if you owned the best apartment building in town, if you owned the highest quality office building in town, if you owned the McDonalds franchise in town, if you owned the Ford dealership. if you owned this collection of assets, even though they’re all geographically concentrated, his perspective is that you will do very well. You will not need to do much else beyond that to have an interesting investing career.”

Quote by Chuck Akre

“The practice of not losing money is significantly advanced by the selection of superior businesses.”

“Our primary frontier of risk management isn’t wide diversification, but the quality of the individual businesses, their balance sheets and the people who run them.”

“If we buy companies in which shareholders’ capital compounds at a 20% rate of return over a reasonable time period and we pay a below-average multiple for it, our investors will do extremely well.”

“We want companies that are positioned to withstand almost any economic environment and that have the financial resources to take advantage of opportunities as they appear, be it acquiring new assets, or repurchasing their own shares at very attractive prices (the reinvestment piece).”

“The relative low level of risk comes not from the absence of volatility, but rather, from the strength of the businesses themselves. This strength is reflected in their balance sheets, their superior returns on capital, and the outstanding quality of their managements.”

“Our favorite businesses will be those which exhibit real pricing power with their brands, which require modest amounts of capital to prosper, which are run by people with equal parts skill and integrity, and which have demonstrated an ability to reinvest virtually all the excess capital that the business generates.”

“We’re looking for managers who have demonstrated they are ‘killers’ at business execution, and who have a history of always acting in the best interests of all shareholders.”

“We look for managers who are owners, and who have always acted in the best interest of ALL shareholders. This leg is the trickiest: our experience shows us that we must follow what these managers have actually done, rather than what it is that they have said they have done. (You know, just the reverse of our parents’ admonition: “do as I say, not as I do”).”

“We will be very disciplined about the price we are willing to pay, as in the end our rate of return will be determined not only by the quality of the businesses we choose to own, but importantly by the starting price as well.”

“Our timetable is five and ten years ahead, and quarterly “misses” often create opportunities for the capital we manage.”

“If you are selling because of a missed earnings report or the trend of the market or something, you’ve stopped looking at the rate of return the company can achieve over time.”

Quotes by Benjamin Graham

“The investor’s chief problem—and his worst enemy—is likely to be himself. In the end, how your investments behave is much less important than how you behave.”

“Those who do not remember the past are condemned to repeat it.”

“The stock investor is neither right or wrong because others agreed or disagreed with him; he is right because his facts and analysis are right.”

“The intelligent investor is a realist who sells to optimists and buys from pessimists.”

“But investing isn’t about beating others at their game. It’s about controlling yourself at your own game.”

“In the short run, the market is a voting machine but in the long run, it is a weighing machine.”

“An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return. Operations not meeting these requirements are speculative.”

“A stock is not just a ticker symbol or an electronic blip; it is an ownership interest in an actual business, with an underlying value that does not depend on its share price.”

“On the other hand, investing is a unique kind of casino—one where you cannot lose in the end, so long as you play only by the rules that put the odds squarely in your favor.”

“You will be much more in control, if you realize how much you are not in control.”

“invest only if you would be comfortable owning a stock even if you had no way of knowing its daily share price.”

“Investment is most intelligent when it is most businesslike.”

Also read: 4M1S Growth Framework: Learn The Inner Workings of A Great Investor.

Quote by Christopher Davis

“Though tempting, trying to time the market is a loser’s game. $10,000 continuously invested in the market over the past 20 years grew to more than $48,000. If you missed just the best 30 days, your investment was reduced to $9,900.”

“A 10% decline in the market is fairly common—it happens about once a year. Investors who realize this are less likely to sell in a panic, and more likely to remain invested, benefitting from the wealthbuilding power of stocks.”

Quotes by Chris Mittleman

“Patience is one of the most critical attributes for a long-term investor because you can be right and the market may tell you that you’re wrong, and it may tell you so for an extended period of time. It may reach the point where your sanity begins to be questioned by clients and even your colleagues. I’ve been in situations like that. There were many times where I’ve been involved in an investment, where it looks like it might not work out, and it ultimately did work out, and worked out wonderfully.”

“The key rules are don’t swing the bat unless it’s a slow pitch right down the middle of the plate, and don’t be bullied by the market into doing something irrational, whether buying or selling. This may sound obvious or clichéd to some, and perhaps confusingly ironic to others, but the ability to sit and do nothing may be the most rare and valuable investing skill of all. Inevitably, extreme price dislocations occur that create real opportunities for action, and only the patient and prepared investor can recognize such ideal situations and take full advantage.”

Quotes by Warren Buffett

“The stock market is a device to transfer money from the impatient to the patient.”

On intrinsic value: “the present value of the stream of cash that’s going to be generated by any financial asset between now and doomsday. And that’s easy to say and impossible to figure.”

“If a business is complex or subject to constant change, we’re not smart enough to predict future cash flows. Second, and equally important, we insist on a margin of safety in our purchase price. If we calculate the value of a common stock to be only slightly higher than its price, we’re not interested in buying. We believe this margin-of-safety principle, so strongly emphasized by Ben Graham, to be the cornerstone of investment success.”

“A market downturn doesn’t bother us. It is an opportunity to increase our ownership of great companies with great management at good prices.”

“An investor should act as though he had a lifetime decision card with just twenty punches on it.”

“An investor needs to do very few things right as long as he or she avoids big mistakes.”

“Long ago, Ben Graham taught me that ‘Price is what you pay; value is what you get.’ Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.”

“For the investor, a too-high purchase price for the stock of an excellent company can undo the effects of a subsequent decade of favorable business developments.”

“Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble.”

“Most people get interested in stocks when everyone else is. The time to get interested is when no one else is. You can’t buy what is popular and do well.”

“I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years.”

“We sell really when we think we’re reevaluating the economic characteristics of the business. We probably had one view of the long-term competitive advantage of the company at the time we’ve bought it, and we may have modified that. That doesn’t mean that we think the company is going into some disastrous period, or anything like that. We think McDonald’s has a fine future, we think Disney has a fine future, and there are others. But we don’t think their competitive advantage is as strong as we thought it was when we initially made the decision.”

“We don’t get paid for activity, just for being right. As to how long we’ll wait, we’ll wait indefinitely”

“The best thing that happens to us is when a great company gets into temporary trouble…We want to buy them when they’re on the operating table.”

“You only have to do a very few things right in your life so long as you don’t do too many things wrong.”

“What counts for most people in investing is not how much they know, but rather how realistically they define what they don’t know.”

“The most important quality for an investor is temperament, not intellect. You need a temperament that neither derives great pleasure from being with the crowd or against the crowd.”

“Equities will do well over time — you just have to avoid getting excited when other people are getting excited.”

“What investors then need is an ability to both disregard mob fears or enthusiasms and to focus on a few simple fundamentals. A willingness to look unimaginative for a sustained period — or even to look foolish — is also essential.”

“No matter how great the talent or efforts, some things just take time. You can’t produce a baby in one month by getting nine women pregnant.”

“You shouldn’t own common stocks if a 50% decrease in their value in a short period of time would cause you acute distress.”

“There is simply no telling how far stocks can fall in a short period. Even if your borrowings are small and your positions aren’t immediately threatened by the plunging market, your mind may well become rattled by scary headlines and breathless commentary. And an unsettled mind will not make good decisions.”

“You do things when the opportunities come along. I’ve had periods in my life when I’ve had a bundle of ideas come along, and I’ve had long dry spells. If I get an idea next week, I’ll do something. If not, I won’t do a damn thing.”

“You’re dealing with a lot of silly people in the marketplace; it’s like a great big casino and everyone else is boozing. If you can stick with Pepsi, you should be OK.”

“It’s far better to buy a wonderful company at a fair price, than a fair company at a wonderful price.”

“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”

“Diversification is protection against ignorance. It makes little sense if you know what you are doing.”

“Time is the friend of the wonderful company, the enemy of the mediocre.”

“Buy a stock the way you would buy a house. Understand and like it such that you’d be content to own it in the absence of any market.”

“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”

“What an investor needs is the ability to correctly evaluate selected businesses. Note that word ‘selected’: You don’t have to be an expert on every company, or even many. You only have to be able to evaluate companies within your circle of competence. The size of that circle is not very important; knowing its boundaries, however, is vital.”

“Over the long term, the stock market news will be good. In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a fly epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497.”

“Our approach is very much profiting from lack of change rather than from change. With Wrigley chewing gum, it’s the lack of change that appeals to me.”

“If you aren’t thinking about owning a stock for 10 years, don’t even think about owning it for 10 minutes.”

“The key to investing is not assessing how much an industry is going to affect society, or how much it will grow, but rather determining the competitive advantage of any given company and, above all, the durability of that advantage.”

“I call investing the greatest business in the world … because you never have to swing. You stand at the plate, the pitcher throws you General Motors at 47! U.S. Steel at 39! and nobody calls a strike on you. There’s no penalty except opportunity lost. All day you wait for the pitch you like; then when the fielders are asleep, you step up and hit it.”

“It is not necessary to do extraordinary things to get extraordinary results.”

“Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.”

“In a bull market, one must avoid the error of the preening duck that quacks boastfully after a torrential rainstorm, thinking that its paddling skills have caused it to rise in the world. A right-thinking duck would instead compare its position after the downpour to that of the other ducks on the pond.”

“What the wise do in the beginning, fools do in the end.”

“The stock market is designed to transfer money from the active to the patient.”

“Loss of focus is what most worries Charlie and me when we contemplate investing in businesses that in general look outstanding. All too often, we’ve seen value stagnate in the presence of hubris or of boredom that caused the attention of managers to wander.”

“Games are won by players who focus on the playing field –- not by those whose eyes are glued to the scoreboard.”

“We believe that a policy of portfolio concentration may well decrease risk if it raises, as it should, both the intensity with which an investor thinks about a business and the comfort-level he must feel with its economic characteristics before buying into it. In stating this opinion, we define risk, using dictionary terms, as “the possibility of loss or injury.”

“The numbers in any accounting report mean nothing, per se, as to economic value. They are guidelines to tell you something about how to get at economic value. … To figure out that answer, you have to understand something about business.”

“We are looking at a whole bunch of businesses, how many birds are they going to give us, when are they going to give them to us, and we try to decide which ones — basically, which bushes — we want to buy out in the future. It’s all about evaluating future — the future ability — to distribute cash, or to reinvest cash at high rates if it isn’t distributed.”

“Our stay-put behaviour reflects our view that the stock market serves as a relocation centre at which money is moved from the active to the patient”

“We throw almost all decisions into the too hard pile, and we just sift for a few decisions that we can make that are easy. And that’s a comparative process. And if you’re looking for an ability to correctly value all investments at all times, we can’t help you.”

“The value of any stock, bond or business today is determined by the cash inflows and outflows — discounted at an appropriate interest rate — that can be expected to occur during the remaining life of the asset.”

“We select such investments on a long-term basis, weighing the same factors as would be involved in the purchase of 100% of an operating business:

(1) favorable long-term economic characteristics;
(2) competent and honest management;
(3) purchase price attractive when measured against the yardstick of value to a private owner; and
(4) an industry with which we are familiar and whose long-term business characteristics we feel competent to judge.”

“If you find three wonderful businesses in your life, you’ll get very rich. And if you understand them — bad things aren’t going to happen to those three. I mean, that’s the characteristic of it.”

“There are all kinds of businesses that Charlie and I don’t think we have the faintest idea what that future stream will look like. And if we don’t have the faintest idea what the future stream is going to look like, we don’t have the faintest idea what it’s worth. … Now, if you think you know what the price of a stock should be today but you don’t think you have any idea what the stream of cash will be over the next 20 years, you’ve got cognitive dissonance. … We are looking for things where we feel — fairly high degree of probability — that we can come within a range of looking at those numbers out over a period of time, and then we discount them back. … We are more concerned with the certainty of those numbers than we are with getting the one that looks absolutely the cheapest.”

“If you can identify six wonderful businesses, that is all the diversification you need. And you will make a lot of money. And I can guarantee that going into a seventh one instead of putting more money into your first one is gotta be a terrible mistake. Very few people have gotten rich on their seventh best idea. But a lot of people have gotten rich with their best idea. So I would say for anyone working with normal capital who really knows the businesses they have gone into, six is plenty, and I probably have half of what I like best. I don‘t diversify personally.”

See also: Kodak Stock is Up Over 1,400% in Two Days. Does It Make Sense?.

Quotes by Li Ka Shing

“In the past years, when the stock market, the property market and the general economy were in the doldrums, we increased our investments. One of the reasons was that we are always prepared. We don’t get carried away when times are good and don’t get too pessimistic when times are bad.”

“During the time China and Britain were having talks in 1982 and 1983, the stock market and the property market were in the doldrums. I remember using only one to two hundred million dollars to get four berths at Container Terminal 6. Later Terminal 7 cost me over four billion. My decision was to press ahead with expansion in the worst of times. That really was the cornerstone of HIT.”

Quotes by Philip L Carret

In 1996, Louis Rukeyser interviewed the legendary Philip Carret and asked him what was the most important lesson of his 75 years of experience. Carret answered just one word: “Patience”.

“Patience can produce uncommon profits.”

Quotes by Charlie Munger

“The world is full of foolish gamblers and they will not do as well as the patient investors.”

“Our investment style has been given a name – focus investing, which implies ten holdings, not one hundred or four hundred.”

“Waiting helps you as an investor and a lot of people just can’t stand to wait. If you didn’t get the deferred-gratification gene, you’ve got to work very hard to overcome that.”

“Those who keep learning, will keep rising in life.”

“You’re looking for a mispriced gamble. That’s what investing is. And you have to know enough to know whether the gamble is mispriced. That’s value investing.”

“If you took our top fifteen decisions out, we’d have a pretty average record. It wasn’t hyperactivity, but a hell of a lot of patience. You stuck to your principles and when opportunities came along, you pounced on them with vigor.”

“A great business at a fair price is superior to a fair business at a great price.”

“I think the record shows the advantage of a peculiar mind-set – not seeking action for its own sake, but instead combining extreme patience with extreme decisiveness”

“There are two kinds of businesses: The first earns twelve percent, and you can take the profits out at the end of the year. The second earns twelve percent, but all the excess cash must be reinvested – there’s never any cash. It reminds me of the guy who sells construction equipment – he looks at his used machines, taken in as customers bought new ones, and says “There’s all of my profit, rusting in the yard.” We hate that kind of business.”

“The big money is not in the buying or the selling, but in the waiting.”

“The idea of excessive diversification is madness.”

“The academics have done a terrible disservice to intelligent investors by glorifying the idea of diversification. Because I just think the whole concept is literally almost insane. It emphasises feeling good about not having your investment results depart very much from average investment results.”

“If you think your IQ is 160 but it’s 150, you’re a disaster. It’s much better to have a 130 IQ and think it’s 120.”

“Black-Scholes is a know-nothing system. If you know nothing about value – only price – then Black-Scholes is a pretty good guess at what a ninety-day option might be worth. But the minute you get into longer periods of time, it’s crazy to get into Black-Scholes.”

“When any guy offers you a chance to earn lots of money without risk, don’t listen to the rest of his sentence. Follow this, and you’ll save yourself a lot of misery.”

“People calculate too much and think too little.”

“You don’t have to be brilliant, only a little it wiser than the other guys, on average, for a long time.”

“Most people are too fretful, they worry too much. Success means being very patient, but aggressive when it’s time.”

“Value investing, the way I regarded it, will never go out of style because value investing, the way I conceive it, is always wanting to get more value than you pay for when you buy a stock and that approach will never go out of style. Some people think that value investing is you chase companies that have a lot of cash and they’re in a lousy business or something. But I don’t define that as value investing. I think all good investing is value investing, and it’s just that some people look for values in strong companies and some look for values in weak companies, but every value investor tries to get more value than she pays for.”

“A well-diversified portfolio needs just four stocks.”

“All good investing involves getting a better investment than you’re paying for. And you’re just looking for it in different places, just as a fisherman can fish in one place or another. Some people look at it in stocks where the earnings are going up all the time, some look at consumer goods, some look at bankruptcies, some look at distressed debt. There are different ways to hunt, just like different places to fish. And that’s investing.”

“Part of the reason I’ve been a little more successful than most people is I’m good at destroying my own best-loved ideas. I knew early in life that that would be a useful knack and I’ve honed it all these years, so I’m pleased when I can destroy an idea that I’ve worked very hard on over a long period of time.” “I don’t even try to be smart. I just try and be not insane and pay no attention to the traditions.”

“People who say they are rational [should] know how things work, what works and what doesn’t, and why. That’s rationality. It doesn’t help if you just know what’s worked before, because if you know why, then you’ll be better at it. So rationality is: Across a broad range of disciplines, you know what works and what doesn’t and why.”

“You only get a few opportunities, and you have to grab them aggressively when they come because even in the most favored life, they’re really rare.” “How many, if I took the 30 biggest transactions out of Berkshire [in the past] 60 years, what would Berkshire be? Not much. I mean we wouldn’t be poor, but we wouldn’t be rich either. Maybe once every two years we had a major opportunity. Not very many.”

“I don’t go to meetings. Warren doesn’t go to meetings. Put that in your article: There’s practically no meetings in the whole Berkshire culture. There are a few telephone calls and no meetings. I don’t care if you print this. Warren gets a headache if he’s in a big meeting where a lot of other people are saying dumb things. He gets a sick headache. He’s not feigning it. He actually does. So part of Berkshire’s secret is, we don’t have the meetings, we don’t have the bureaucracy. We’ve concentrated a lot of power in the Greg Abels and so forth. It works better averaged out.”

“You have to know a lot, but partly it’s temperament, partly it’s deferred gratification, you gotta be willing to wait. Good investing requires a weird combination of patience and aggression and not many people have it. It also requires a big amount of self-awareness about how much you know and what you don’t know. You have to know the edge of your own competency, and a lot of brilliant people think they’re way smarter than they are. And of course that’s dangerous and causes trouble”

“The whole secret of investment is to find places where it’s safe and wise to non-diversify. It’s just that simple. Diversification is for the know-nothing investor; it’s not for the professional.”

“The idea that very smart people with investment skills should have hugely diversified portfolios is madness. It’s a very conventional madness. And it’s taught in all the business schools. But they’re wrong.”

“Berkshire has a substantial shareholder whose father accumulated the original position, and when he died he left a very large estate, practically all of which was in two securities, Berkshire and one other outstanding company. A bank was co-trustee. And the bank trust officer said you’ve got to diversify this. And, you know, it was a very large estate. And the young man who was co-trustee with the bank said, “Well,” he says, “you know, if my father believed the way you do, he might have been a trust officer in a bank instead of — (laughter) — leaving this large estate.” (Applause). And that young man holds the Berkshire to this day. And I suppose the bank is still giving the same advice.”

Quotes by Seth Klarman

“Ultimately, nothing should be more important to investors than the ability to sleep soundly at night.”

“The investor then explained his selling strategy. He gave the example if his firm buys a stock at $10 that is worth $20, when it rises to $18 or $18.50 they sell it.

“We never hold on for the last nickel. I think you make a big mistake when you do that. We never assume something will go past its fair value,” he said. “We’ll let someone else make the last dollar or two. … We’ll always sell too soon.“

Klarman said the selling discipline allows him to rebuy a stock after it drops. It also helps him avoid the psychological damage of watching an unrealized profit disappear due to greed.”

“Buying stocks at an appreciable discount from the value of the underlying business is one strategy that provides a roadmap to successfully navigate not only through good times but also the turmoil. Buying at a discount creates a margin of safety for the investor — room for imprecision, error, bad luck or the vicissitudes of volatile markets and economies.”

“Value investing is at its core the marriage of a contrarian streak and a calculator.”

“Most investors are primarily oriented toward return, how much they can make and pay little attention to risk, how much they can lose.”

“So our focus was let’s not lose money. As I guess Ben Graham says in The Intelligent Investor – Warren Buffett requotes it, I’m pretty sure – rule number one in investing is don’t lose money and rule number two is never forget rule number one. And I think those are really important words. If you walk away with one lesson, remember that. That there’s plenty of investments. If they’re not great ones today, they’ll be great ones tomorrow or the day after. You don’t have to do anything. Losing money is very hard to get back to where you were, let alone to end up doing better.”

“The single greatest edge an investor can have is a long-term orientation.”

“The inability to hold cash and the pressure to be fully invested at all times meant that when the plug was pulled out of the tub, all boats dropped as the water rushed down the drain.”

“Investment success cannot be captured in a mathematical equation or a computer program.”

“Value investors should completely exit a security by the time it reaches full value; owning overvalued securities is the realm of speculators.”

“Value investors have to be patient and disciplined, but what I really think is you need not to be greedy. If you’re greedy and you leverage, you blow up. Almost every financial blow up is because of leverage.”

“The stock market is the story of cycles and of the human behaviour that is responsible for overreactions in both directions.”

“In a rising market, everyone makes money and a value philosophy is unnecessary. But because there is no certain way to predict what the market will do, one must follow a value philosophy at all times.”

“While some might mistakenly consider value investing a mechanical tool for identifying bargains, it is actually a comprehensive investment philosophy that emphasizes the need to perform in-depth fundamental analysis, pursue long-term investment results, limit risk, and resist crowd psychology.”

“Pressure to produce over the short term – a gun to the head of everyone – encourages excessive risk taking which manifests itself in several ways – fully invested posture at all times, the use of leverage, and a market centric orientation that makes it difficult to stand apart from the crowd and take a long term perspective.”

“In reality, no one knows what the market will do; trying to predict it is a waste of time, and investing based upon that prediction is a speculative undertaking.”

“A commodity doesn’t have the same characteristics as a security, characteristics that allow for analysis. Other than a recent sale or appreciation due to inflation, analyzing the current or future worth of a commodity is nearly impossible.”

“To achieve long-term success over many financial market and economic cycles, observing a few rules is not enough. Too many things change too quickly in the investment world for that approach to succeed. It is necessary instead to understand the rationale behind the rules in order to appreciate why they work when they do and don’t when they don’t.”

“In a crisis, stocks of financial companies are great investments, because the tide is bound to turn. Massive losses on bad loans and soured investments are irrelevant to value; improving trends and future prospects are what matter, regardless of whether profits will have to be used to cover loan losses and equity shortfalls for years to come.”

“Value investing is risk aversion.”

“Investors should always keep in mind that the most important metric is not the returns achieved but the returns weighed against the risks incurred. Ultimately, nothing should be more important to investors than the ability to sleep soundly at night.”

“If you can remember that stocks aren’t pieces of paper that gyrate all the time –they are fractional interests in businesses — it all makes sense.”

“Loss avoidance must be the cornerstone of your investment philosophy.”

“Almost every financial blow up is because of leverage.”

“As value investors, our business is to buy bargains that financial market theory says do not exist. We’ve delivered great returns to our clients for a quarter century-a dollar invested at inception in our largest fund is now worth over 94 dollars, a 20% net compound return. We have achieved this not by incurring high risk as financial theory would suggest, but by deliberately avoiding or hedging the risks that we identified.”

“You must buy on the way down. There is far more volume on the way down than on the way back up, and far less competition among buyers. It is almost always better to be too early than too late, but you must be prepared for price markdowns on what you buy.”

“Typically, we make money when we buy things. We count the profits later, but we know we have captured them when we buy the bargain.”

“I think Buffett is a better investor than me because he has a better eye toward what makes a great business. And when I find a great business I’m happy to buy it and hold it. Most businesses don’t look so great to me.”

“Sometimes buying early on the way down looks like being wrong, but it isn’t.”

“While it might seem that anyone can be a value investor, the essential chaacteristics of this type of investor – patience, discipline, and risk aversion – may well be genetically determined.”

“The best protection against risk is knowing what you are doing.”

“The stock market is the story of cycles and of the human behaviour that is responsible for overreactions in both directions.”

“When all feels calm and prices surge, the markets may feel safe; but, in fact, they are dangerous because few investors are focusing on risk.”

“In a world in which most investors appear interested in figuring out how to make money every second and chase the idea du jour, there’s also something validating about the message that it’s okay to do nothing and wait for opportunities to present themselves or to pay off. That’s lonely and contrary a lot of the time, but reminding yourself that that’s what it takes is quite helpful.”

“One thing I want to emphasize is that, like any human being, we can discuss our view of the economy and the market. Fortunately for our clients, we don’t tend to operate based on the view. Our investment strategy is to invest bottom up, one stock at a time, based on price compared to value. And while we may have a macro view that things aren’t very good right now – which in fact we feel very strongly we will put money to work regardless of that macro view if we find bargains. So tomorrow, if we found half a dozen bargains, we would invest all our cash.”

“Did we ever mention that investing is hard work — painstaking, relentless, and at times confounding? Separating relevant signal from noise can be especially difficult. Endless patience, great discipline, and steely resolve are required. Nothing you do will guarantee success, though you can tilt the odds significantly in your favor by having the right philosophy, mindset, process, team, clients, and culture. Getting those six things right is just about everything.

Complicating matters further, a successful investor must possess a number of seemingly contradictory qualities. These include the arrogance to act, and act decisively, and the humility to know that you could be wrong. The acuity, flexibility, and willingness to change your mind when you realize you are wrong, and the stubbornness to refuse to do so when you remain justifiably confident in your thesis. The conviction to concentrate your portfolio in your very best ideas, and the common sense to nevertheless diversify your holdings. A healthy skepticism, but not blind contrarianism. A deep respect for the lessons of history balanced by the knowledge that things regularly happen that have never before occurred. And, finally, the integrity to admit mistakes, the fortitude to risk making more of them, and the intellectual honesty not to confuse luck with skill.”

“There are only a few things investors can do to counteract risk: diversify adequately, hedge when appropriate, and invest with a margin of safety. It is a precisely because we do not and cannot know all the risks of an investment that we strive to invest at a discount. The bargain element helps to provide a cushion for when things go wrong.”

“A value strategy is of little use to the impatient investor since it usually takes time to pay off.”

Also read: “Patience Produce Uncommon Profits” – Why Patience in Investing is Vital.

Quotes by Peter Lynch

“When stocks are attractive, you buy them. Sure, they can go lower. I’ve bought stocks at $12 that went to $2, but then they later went to $30. You just don’t know when you can find the bottom.”

“There is always something to worry about. Avoid weekend thinking and ignoring the latest dire predictions of the newscasters. Sell a stock because the company’s fundamentals deteriorate, not because the sky is falling.”

“Everyone has the brainpower to make money in stocks. Not everyone has the stomach. If you are susceptible to selling everything in a panic, you ought to avoid stocks and mutual funds altogether.”

“What makes stocks valuable in the long run isn’t the market. It’s the profitability of the shares in the companies you own. As corporate profits increase, corporations become more valuable and sooner or later, their shares will sell for a higher price.”

“The list of qualities (an investor should have) include patience, self-reliance, common sense, a tolerance for pain, open-mindedness, detachment, persistence, humility, flexibility, a willingness to do independent research, an equal willingness to admit mistakes, and the ability to ignore general panic.”

“In this business if you’re good, you’re right six times out of ten. You’re never going to be right nine times out of ten.”

“A price drop in a good stock is only a tragedy if you sell at that price and never buy more. To me, a price drop is an opportunity to load up on bargains from among your worst performers and your laggards that show promise. If you can’t convince yourself “When I’m down 25 percent, I’m a buyer” and banish forever the fatal thought “When I’m down 25 percent, I’m a seller,” then you’ll never make a decent profit in stocks.”

“Just because you buy a stock and it goes up does not mean you are right. Just because you buy a stock and it goes down does not mean you are wrong.”

“There’s lots of stocks out there and all you need is a few of ’em. That’s been my philosophy.”

“I think you have to learn that there’s a company behind every stock, and that there’s only one real reason why stocks go up. Companies go from doing poorly to doing well or small companies grow to large companies.”

“I’ve always said, the key organ here isn’t the brain, it’s the stomach. When things start to decline – there are bad headlines in the papers and on television – will you have the stomach for the market volatility and the broad-based pessimism that tends to come with it?”

“Hold no more stocks than you can remain informed on.”

“There’s no shame in losing money on a stock. Everybody does it. What is shameful is to hold on to a stock, or worse, to buy more of it when the fundamentals are deteriorating.”

“You have to let the big ones make up for your mistakes.”

“Investing in stocks is an art, not a science, and people who’ve been trained to rigidly quantify everything have a big disadvantage.”

“Know what you own, and know why you own it.”

“Stocks are a safe bet, but only if you stay invested long enough to ride out the corrections.”

“In the long run, a portfolio of well chosen stocks and/or equity mutual funds will always outperform a portfolio of bonds or a money-market account. In the long run, a portfolio of poorly chosen stocks won’t outperform the money left under the mattress.”

“Absent a lot of surprises, stocks are relatively predictable over twenty years. As to whether they’re going to be higher or lower in two to three years, you might as well flip a coin to decide.”

“Avoid hot stocks in hot industries.”

“The typical big winner in the Lynch portfolio generally takes three to ten years to play out.”

Quotes by Li Lu

“Management is always part of the equation of making the company successful, so the quality of management always matters.”

“Investing is about intellectual honesty. You want to know what you know. You want to know, mostly, what you don’t know.”

“The game of investing is a process of discovering who you are, what you’re interested in, what you’re good at, what you love to do, then magnifying that until you gain a sizable edge over all the other people.”

Quotes by Carl Icahn

“In life and business, there are two cardinal sins. The first is to act precipitously without thought and the second is to not act at all.”

“The CEO is, by far, the most important decision for a company… The company is going to rise and fall with the CEO.”

“Reuters was completely accurate that I am concerned about the level of the market. But I also made it clear on the conference call (and I believe as Reuters reported it), that it is almost impossible to predict what a market will do in the short term. There are too many variables.”

“Some people get rich studying artificial intelligence. Me, I make money studying natural stupidity.”

Quotes by Joel Greenblatt

“The secret to investing is to figure out the value of something – and then pay a lot less.”

“The more confidence I have in each one of my stock picks, the fewer companies I need to own in my portfolio to feel comfortable.”

“Remember, it’s the quality of your ideas not the quantity that will result in the big money.”

“The big picture is: the main thing you should be concerned about in the future are incremental returns on capital going forward. As it turns out, past history of a good return on capital is a good proxy for this but obviously not foolproof. I think this is an area where thoughtful analysis can add value to any simple ranking/screening strategy such as the magic formula. When doing in depth analysis of companies, I care very much about long term earnings power, not necessarily so much about the volatility of that earnings power but about my certainty of “normal” earnings power over time.”

“Value investing strategies have worked for years and everyone’s known about them. They continue to work because it’s hard for people to do, for two main reasons. First, the companies that show up on the screens can be scary and not doing so well, so people find them difficult to buy. Second, there can be one-, two- or three-year periods when a strategy like this doesn’t work. Most people aren’t capable of sticking it out through that.”

“There’s a clarity that comes with great ideas: You can [easily and simply] explain why something’s a great business, how and why it’s cheap, why it’s cheap for temporary reasons and how, on a normal basis, it should be trading at a much higher level. You’re never sitting there on the 40th page of your spreadsheet, as Buffett would say, agonizing over whether you should buy or not.”

“So one way to create an attractive risk/reward situation is to limit downside risk severely by investing in situations that have a large margin of safety. The upside, while still difficult to quantify, will usually take care of itself. In other words, look down, not up, when making your initial investment decision. If you don’t lose money, most of the remaining alternatives are good ones.”

“I still believe that for good business analysts a concentrated portfolio is a good strategy combined with a long term horizon. Once again, the secret to success in following the formula strategy is patience, a quality in short supply for both professionals and individual investors alike. I think investors should have a large portion of their assets in equities over time.”

“The biggest challenge for investors is patience and that is in short supply. You used to get a quarterly statement and often throw it in the garbage; now you can check your stock price 30 times a minute. There’s a lot more data, a lot more ability to crunch numbers and compare people. That works against investors, and patience continues to be the hardest challenge. It always was, but now it is even worse.”


The information provided is for general information purposes only and is not intended to be a personalized investment or financial advice.

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