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High valuations entail high risks.

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
Investing
Risk
High
Valuations
Entail
Valuation
Risks

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Thousands of people have tried, and the evidence is clear: The more you trade, the less you keep.
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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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The money cost of the reservoir plan literally fades into insignificance when it is compared with the financial burden which the great depression imposed on the nation.
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The defensive (or passive) investor will place chief emphasis on the avoidance of serious mistakes or losses. His second aim will be freedom from effort, annoyance, and the need for making frequent decisions.
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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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Before you invest, you must ensure that you have realistically assessed your probability of being right and how you will react to the consequences of being wrong.
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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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Cartels have spread and will spread as long as the world lacks an effective mechanism by which balanced expansion may be achieved without a resulting disruption of prices.
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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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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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Why should the cotton growers suffer if there is shortage of wheat?
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The investor's primary interest lies in acquiring and holding suitable securities at suitable prices.
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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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Good managements produce a good average market price, and bad managements produce bad market prices.
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The investor should be aware that even though safety of its principal and interest may be unquestioned, a long term bond could vary widely in market price in response to changes in interest rates.
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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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Experience teaches that the time to buy stocks is when their price is unduly depressed by temporary adversity. In other words, they should be bought on a bargain basis or not at all.
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Never buy a stock immediately after a substantial rise or sell one immediately after a substantial drop.
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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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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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