Benjamin Graham Quotes

The best values today are often found in the stocks that were once hot and have since gone cold.

Investing is most intelligent when it is most businesslike.

An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return.

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.

To enjoy a reasonable chance for continued better than average results, the investor must follow policies which are (1) inherently sound and promising, and (2) not popular on Wall Street.

It is absurd to think that the general public can ever make money out of market forecasts.

The intelligent investor should recognize that market panics can create great prices for good companies and good prices for great companies.

Successful investing is about managing risk, not avoiding it.

I am more and more impressed with the possibilities of history's repeating itself on many different counts. You don't get very far in Wall Street with the simple, convenient conclusion that a given level of prices is not too high.

The investor's chief problem - and even his worst enemy - is likely to be himself.

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.

High valuations entail high risks.

Have the courage of your knowledge and experience. If you have formed a conclusion from the facts and if you know your judgment is sound, act on it – even though others may hesitate or differ.

The underlying principles of sound investment should not alter from decade to decade, but the application of these principles must be adapted to significant changes in the financial mechanisms and climate.

... 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.

There is a close logical connection between the concept of a safety margin and the principle of diversification.

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.

An investor calculates what a stock is worth, based on the value of its businesses.

Diversification is an established tenet of conservative investment.

The market is always making mountains out of molehills and exaggerating ordinary vicissitudes into major setbacks.

It's nonsensical to derive a price/earnings ratio by dividing the known current price by unknown future earnings.

In the old legend the wise men finally boiled down the history of mortal affairs into a single phrase: 'This too will pass.'

Confronted with a challenge to distill the secret of sound investment into three words, we venture the motto, Margin of Safety.

To have a true investment, there must be a true margin of safety. And a true margin of safety is one that can be demonstrated by figures, by persuasive reasoning, and by reference to a body of actual experience.

we have complaints that institutional dominance of the stock market has put 'the small investor at a disadvantage because he can't compete with the trust companies' huge resources, etc. The facts are quite the opposite. It may be that the institutions are better equipped than the individual to speculate in the market.But I am convinced that an individual investor with sound principles, and soundly advised, can do distinctly better over the long pull than large institutions.

The art of investment has one characteristic that is not generally appreciated. A creditable, if unspectacular, result can be achieved by the lay investor with a minimum of effort and capability; but to improve this easily attainable standard requires much application and more than a trace of wisdom. If you merely try to bring just a little extra knowledge and cleverness to bear upon your investment program, instead of realizing a little better than normal results, you may well find that you have done worse.

Undervaluations caused by neglect or prejudice may persist for an inconveniently long time, and the same applies to inflated prices caused by over-enthusiasm or artificial stimulants.

The true investor... will do better if he forgets about the stock market and pays attention to his dividend returns and to the operation results of his companies.

In other words, the market is not a weighing machine, on which the value of each issue is recorded by an exact and impersonal mechanism, in accordance with its specific qualities. Rather should we say that the market is a voting machine, whereon countless individuals register choices which are the product partly of reason and partly of emotion.

Never mingle your speculative and investment operations in the same account nor in any part of your thinking.

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.

I am no longer an advocate of elaborate techniques of security analysis in order to find superior value opportunities.

We have been trying to point out that this concept of an indefinitely favorable future is dangerous, even if it is true; because even if it is true you can easily overvalue the security, since you make it worth anything you want it to be worth. Beyond this, it is particularly dangerous too, because sometimes your ideas of the future turn out to be wrong. Then you have paid an awful lot for a future that isn't there. Your position then is pretty bad.

The purpose of this book is to supply, in the form suitable for laymen, guidance in the adoption and execution of an investment policy.

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.

Avoid second-quality issues in making up a portfolio unless they are demonstrable bargains.

To be an investor you must be a believer in a better tomorrow.

By developing your discipline and courage, you can refuse to let other people's mood swings govern your financial destiny. In the end, how your investments behave is much less important than how you behave.

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.

People who invest make money for themselves; people who speculate make money for their brokers. And that, in turn, is why Wall Street perennially downplays the durable virtues of investing and hypes the gaudy appeal of speculation.

The essence of investment management is the management of risks, not the management of returns.

A defensive investor can always prosper by looking patiently and calmly through the wreckage of a bear market.

Losing some money is an inevitable part of investing, and there's nothing you can do to prevent it. But to be an intelligent investor, you must take responsibility for ensuring that you never lose most or all of your money.

Both individual skill (art) and chance are important factors in determining success or failure.

No statement is more true and better applicable to Wall Street than the famous warning of Santayana: "Those who do not remember the past are condemned to repeat it".