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It should be remembered that a decline of 50% fully offsets a preceding advance of 100%.

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
Advance
Investing
Remembered
Fully
Preceding
Decline

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An intelligent investor gets satisfaction from the thought that his operations are exactly opposite to those of the crowd.
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The intelligent investor is a realist who sells to optimists and buys from pessimists.
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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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The chief obstacle to success lies in the stubborn fact that if the favorable prospects of a concern are clearly apparent they are almost always reflected already in the current price of the stock. Buying such an issue is like betting on a topheavy favorite in a horse race. The chances may be on your side, but the real odds are against you.
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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.
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There is a close logical connection between the concept of a safety margin and the principle of diversification.
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Mr. Market does not always price stocks the way an appraiser or a private buyer would value a business. Instead, when stocks are going up, he happily pays more than their objective value and, when they are going down, he is desperate to dump them for less than their true worth.
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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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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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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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Price statistics show clearly that instability in raw-material prices is a prime cause of instability of other prices.
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At heart, uncertainty and investing are synonyms.
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The essence of investment management is the management of risks, not the management of returns.
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Mr. Market's job is to provide you with prices your job is to decide whether it is to your advantage to act on them. You no not have to trade with hime just because he constantly begs you to.
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Why should the cotton growers suffer if there is shortage of wheat?
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We define a bargain issue as one which, on the basis of facts established by analysis, appears to be worth considerably more that it is selling for.
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