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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.

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
Value
Test
Initially
Security
Beat
Urge
Study
Price
Versus
Effort
Tests
Urges
Possible
Beats
Smallest
Values
Market
Efforts
Beginner
Money
Waste
Buying
Sums
Trying
Judgment
Investing
Beginners

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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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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 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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Avoid second-quality issues in making up a portfolio unless they are demonstrable bargains.
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Successful investment may become substantially a matter of techniques and criteria that are learnable, rather than the product of unique and incommunicable mental powers.
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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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Price fluctuations have only one significant meaning for the true investor. They provide him with an opportunity to buy wisely when prices fall sharply and to sell wisely when they advance a great deal.
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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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Buy when most people, including experts, are pessimistic, and sell when they are actively optimistic.
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No matter how careful you are, the one risk no investor can ever eliminate is the risk of being wrong. Only by insisting on what Graham called the margin of safety - never overpaying, no matter how exciting an investment seems to be - can you minimize your odds of error.
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The best values today are often found in the stocks that were once hot and have since gone cold.
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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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The individual investor should act consistently as an investor and not as a speculator. This means ... that he should be able to justify every purchase he makes and each price he pays by impersonal, objective reasoning that satisfies him that he is getting more than his money's worth for his purchase.
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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.
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It always seemed, and still seems, ridiculously simple to say that if one can acquire a diversified group of common stocks at a price less than the applicable net current assets alone - after deducting all prior claims, and counting as zero the fixed and other assets - the results should be quite satisfactory.
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In an ideal world, the intelligent investor would hold stocks only when they are cheap and sell them when they become overpriced, then duck into the bunker of bonds and cash until stocks again become cheap enough to buy.
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Always buy your straw hats in the Winter
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Why should the cotton growers suffer if there is shortage of wheat?
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