Just as many smart people fail in the investment business as stupid ones. Intellectually active people are particularly attracted to elegant concepts, which can have the effect of distracting them from the simpler, more fundamental truths.

The company must be profitable. Preferably it will have increased its earnings for the past five years and there will have been no deficits over that period.

I bought stuff at 3.5 cents once and I thought it can’t go down to zero. It can.

Protect the downside. Worry about the margin of safety.

All we try to do is buy a dollar for 40 cents.

There will be losing years; but if the art of making money is not to lose it, then there should not be substantial losses.

The price earning multiple must be less than ten or the inverse of the long term corporate bond rate, whichever is the less.