Quotes About Investing

Have patience. Stocks don't go up immediately.

The growth stock theory of investing requires patience, but is less stressful than trading, generally has less risk, and reduces brokerage commissions and income taxes.

Patience is one of the most valuable attributes in investing.

You find bargains among the unpopular things, the things that everybody hates. The key is that you must have patience.

The environment you fashion out of your thoughts, your beliefs, your ideals, your philosophy is the only climate you will ever live in. The key is in not spending time, but in investing it.

Everyone has the brain power to make money in stocks. Not everyone has the stomach.

Understanding both the power of compound interest and the difficulty of getting it is the heart and soul of understanding a lot of things.

First of all, said Templeton, beware of emotion: "Most people get led astray by emotions in investing. They get led astray by being excessively careless and optimistic when they have big profits, and by getting excessively pessimistic and too cautious when they have big losses.

As Kahn put it, the secret of investing could be expressed in one word: "safety." And the key to making intelligent investment decisions was always to begin by asking, "How much can I lose?

If you want to become "a stock market master," he explained, "stick to buying good companies (ones that have a high return on capital) and to buying those companies only at bargain prices (at prices that give you a high earnings yield).

Stocks are ownership shares of businesses," which "you're valuing and trying to buy at a discount." The key, then, is to identify situations in which there's a particularly large spread between the price and the value of the business. That spread gives you a margin of safety, which Greenblatt (like Graham and Buffett) regards as the single most important concept in investing.

Kahn's answer: "Investing is about preserving more than anything. That must be your first thought, not looking for large gains. If you achieve only reasonable returns and suffer minimal losses, you will become a wealthy man and will surpass any gambler friends you may have. This is also a good way to cure your sleeping problems.

First, they provide a compelling example of what it means to pursue quality as a guiding principle in business, investing, and life—a moral and intellectual commitment inspired by Zen and the Art of Motorcycle Maintenance.

How do you avoid overconfidence? By telling yourself at least a few times per year, 'The market is much smarter than I will ever be.

First, we invest now so that we may spend later. In fact, this is the essence of investing: the forbearance of immediate spending in exchange for future income. Because of the mathematics of compound interest, spending even a tiny fraction on a regular basis devastates final wealth over the long haul.

Although you should not let your emotional responses dictate your allocation, you do need to sleep at night, and your personal preferences are an important part of your asset class structure.

If you are such an individual and become upset when one of your asset classes does poorly, even when the rest of your portfolio is doing well, then you should not be managing your own money.

The concept that all useful information has already been factored into a stock's price, and that analysis is futile, is known as 'The Efficient Market Hypothesis' (EMH).

The five major domestic asset classes you should use are: large market, small market, large value, small value, REITs.

If your portfolio risk exceeds your tolerance for loss, there is a high likelihood that you will abandon your plan when the going gets rough.

Because we cannot predict the future, we diversify. —Paul Samuelson

Owning the U.S. "market" means the whole shooting match—the Wilshire 5000. The granddaddy of all "total-market" funds is the Vanguard Total Stock Market Index Fund. With rock-bottom expenses of 0.20%, it is a superb choice. Since its inception in 1992, it has done an excellent job of tracking the Wilshire 5000

But whatever allocation you settle on, the key is to stick with it through thick and thin, including rebalancing back to your target percentage on a regular basis.

If done properly, successful investing entertains as much as watching clothes tumble in the dryer window. Always remember that the more exciting a given stock or asset class is, the more likely it is to be over-owned, overpriced, and destined for low future returns.