Quotes from Benjamin Graham

In our view the search for these would not be worth the investor's effort unless he could hope to add, say, 5% before taxes to the average annual return from the stock portion of his portfolio.

Such an investor may for example be a buyer of air-transport stocks because he believes their future is even more brilliant than the trend the market already reflects. For this class of investor the value of our book will lie more in its warnings against the pitfalls lurking in this favorite investment approach than in any positive technique that will help him along his path.

The future of security prices is never predictable. And as you read ahead in the book, notice how everything else Graham tells you is designed to help you grapple with that truth. Since you cannot predict the behavior of the markets, you must learn how to predict and control your own behavior.

One of Graham's most powerful insights is this: "The investor who permits himself to be stampeded or unduly worried by unjustified market declines in his holdings is perversely transforming his basic advantage into a basic disadvantage." What does Graham mean by those words "basic advantage"? He means that the intelligent individual investor has the full freedom to choose whether or not to follow Mr. Market. You have the luxury of being able to think for yourself

The intelligent investor realizes that stocks become more risky, not less, as their prices rise—and less risky, not more, as their prices fall.

The one principle that applies to nearly all these so-called "technical approaches" is that one should buy because a stock or the market has gone up and one should sell because it has declined. This is the exact opposite of sound business sense everywhere else, and it is most unlikely that it can lead to lasting success on Wall Street.

Investment must always consider the price as well as the quality of the security.

An investment operation is one that can be justified on both qualitative and quantitative grounds.

Is the stock market riskier today than two years ago simply because prices are higher? The answer is no." But the answer is yes. It always has been. It always will be.

The happiness of those who want to be popular depends on others; the happiness of those who seek pleasure fluctuates with moods outside their control; but the happiness of the wise grows out of their own free acts. —Marcus Aurelius

The defensive investor must confine himself to the shares of important companies with a long record of profitable operations and in strong financial condition.

You have the luxury of being able to think for yourself.

The individual investor should act consistently as an investor and not as a speculator

If they follow our prescription they will confine themselves to high-grade bonds and the common stocks of leading corporations, preferably those that can be purchased at individual price levels that are not high in the light of experience and analysis.

the intelligent investor designates a tiny portion of her total portfolio as a "mad money" account. For most of us, 10% of our overall wealth is the maximum permissible amount to put at speculative risk. Never mingle the money in your speculative account with what's in your investment accounts; never allow your speculative thinking to spill over into your investing activities; and never put more than 10% of your assets into your mad money account, no matter what happens.

then that it was by far the best book about investing ever written. I still think it is. To invest successfully over a

That's because whenever we are too close to someone or something, we take our beliefs for granted, instead of questioning them as we do when we confront something more remote. The more familiar a stock is, the more likely it is to turn a defensive investor into a lazy one who thinks there's no need to do any homework. Don't let that happen to you.

Instead, let's tune out the noise and think about future returns as Graham might. The stock market's performance depends on three factors: real growth (the rise of companies' earnings and dividends) inflationary growth (the general rise of prices throughout the economy) speculative growth—or decline (any increase or decrease in the investing public's appetite for stocks)

This brief review indicates that the stock market's attitude toward secondary companies tends to be unrealistic and consequently to create in normal times innumerable instances of major undervaluation.

we advised the readers to buy their stocks as they bought their groceries, not as they bought their perfume.

We should advise rather strongly against the initiation of a new dollar-averaging plan at the late 1964 levels, since many investors would not have the stamina to pursue such a scheme if the results soon after initiation should appear highly unfavorable.

Hence if the investor was in a maximum tax bracket higher than 30% he would have a net saving after taxes by choosing the municipal bonds; the opposite, if his maximum tax was less than 30%.

arte de la inversión de éxito radica en primer lugar en la elección de los sectores que tienen más probabilidades de crecer en el futuro, y en la identificación de las empresas más prometedoras dentro de esos sectores.

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