Quotes from Barry Ritholtz

A hedge fund manager whose clients demand monthly performance reports has different needs than any individual investors with a 20-year time horizon. The needs of that long-term investor differ markedly from someone who is retiring in three years.

If you think too-big-to-fail banks are not worthy of investment because of their impossible-to-read balance sheets, well then, don't buy them.

To know whether stocks are cheap or pricey, we typically look at price-to-earnings ratio. Valuation is a tougher question than many folks realize.

When you buy anything with lots of leverage, it does not require a whole lot to go wrong to lose it all.

You want less of the annoying nonsense that interferes with your portfolios and more of the significant data that allow you to become a less distracted, more purposeful investor.

Getting more and more of our news from the social network is having significant repercussions for markets - and your money.

Whenever I see a forecast written out to two decimal places, I cannot help but wonder if there is a misunderstanding of the limitations of the data, and an illusion of precision.

It is important for investors to understand what they do and don't know. Learn to recognize that you cannot possibly know what is going to happen in the future, and any investment plan that is dependent on accurately forecasting where markets will be next year is doomed to failure.

The beauty of diversification is it's about as close as you can get to a free lunch in investing.

When it comes to investing, you are your own worst enemy.

In the investment business, you must expect to be wrong.

If I am going to trash others for their dumb predictions, I must at least hold myself to the same sort of accountability.

Truth be told, most financial television bores me. Two or more people discussing the latest economic trends or hot stocks is not especially entertaining.

Many hedge fund managers have become billionaires; perhaps this - plus their reputations as the smartest guys in the room - is why they have captured the investing public's imagination.

Content is king. When you are asking people to read you several times a day, you better have some fine content.

Never forget this simple truism: Forecasting is marketing, plain and simple.

Based on a lifetime of observations and a few decades in the markets, I understand that societies, beliefs and fashions all move in long arcs of time. We call these arcs several things: cycles, periods, eras.

The electronics industry expanded rapidly and the seeds for the semiconductor and software revolution were planted. The postwar period also saw the suburbanization of America, the rise of the homeowner, the build-out of the interstate highway system, and the rise of automobile culture. Credit availability expanded dramatically.

No one knows what the top-performing asset class will be next year. Lacking this prescience, your next-best solution is to own all of the classes and rebalance regularly.

Shopmas now begins on Thanksgiving Day. Apparently, escaping the families you cannot stand to spend another minute with on Thanksgiving Day to go buy them gifts is how some Americans show their affection for one another. Weird.

We must recognize our own behavioral errors. To be blunt, you are not likely to become a cognitive Zen master anytime soon. But a little enlightenment could keep you from making some common investing errors.

When markets are rallying, cash in the portfolio is a drag on performance, returning about zero.

Commissions add up, taxes are a big drag, margin ain't cheap. A good accountant costs money as well. The math on this one is obvious, yet investors often fail to recognize it: Keep your costs low and your turnover lower, and you will win in the end.

Twitter has become a group conversation of that type that used to take place on trading floors.