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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 Graham

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Benjamin Graham
Age: 82 †
Born: 1894
Born: May 8
Died: 1976
Died: September 21
Economist
Financier
Investor
University Teacher
Writer
London
England
Way
Subject
Tendency
Stocks
Time
Subjects
Tendencies
Excessive
People
Common
Greed
Gamble
Hope
Investing
Directions
Fluctuations
Fear
Investment
Speculation
Fluctuation
Money
Price
Irrational
Speculate
Give
Consequence
Professors
Ingrained
Giving
Financial
Finance
Gamer

More quotes by Benjamin Graham

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Speculators often prosper through ignorance it is a cliché that in a roaring bull market knowledge is superfluous and experience is a handicap. But the typical experience of the speculator is one of temporary profit and ultimate loss
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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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Never mingle your speculative and investment operations in the same account nor in any part of your thinking.
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In the world of securities, courage becomes the supreme virtue after adequate knowledge and a tested judgment are at hand.
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The beauty of periodic rebalancing is that it forces you to base your investing decisions on a simple, objective standard.
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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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The value of the security analyst to the investor depends largely on the investor's own attitude. If the investor asks the analyst the right questions, he is likely to get the right or at least valuable answers.
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Confronted with a challenge to distill the secret of sound investment into three words, we venture the motto, Margin of Safety.
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The sillier the market's behavior, the greater the opportunity for the business like investor.
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It is absurd to think that the general public can ever make money out of market forecasts.
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It is worth pointing out that assuredly not more than one person out of a hundred who stayed in the market after after 1925 emerged from it with a net profit and that the speculative losses taken were appalling.
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To establish the right price for a stock, the market must have adequate information, but it by no means follows that is the market has this information it will thereupon establish the right price.
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Do not let anyone else run your business
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We urge the beginner in security buying not to waste his efforts and his money in trying to beat the market. Let him study security values and initially test out his judgment on price versus value with the smallest possible sums.
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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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Even the most conservative must realize that the recent transformation of surplus from an individual to a national disaster implies a scathing indictment of our capitalist system as it has now developed.
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Stocks can be dynamite.
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The essence of investment management is the management of risks, not the management of returns.
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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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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.
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