Investing Quotes - Page 20

• Many of us economists who believe in efficiency do so because we view markets as amazingly successful devices for reflecting new information rapidly and, for the most part, accurately.

  Burton Malkiel

  Believe, Successful, Views

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• Knowing the importance of luck, you should be particularly suspicious when highly consistent patterns emerge from the comparison of successful and less successful firms. In the presence of randomness, regular patterns can only be mirages.

  Daniel Kahneman

  Successful, Knowing, Luck

  Daniel Kahneman (2011). “Thinking, Fast and Slow”, p.236, Macmillan

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• Inactivity strikes us as intelligent behavior.

  Warren Buffett

  Intelligent, Behavior, Strikes

  "Warren Buffett Has 2 Basic Rules That Investors Always Fail To Follow" by Robert Huerbscher, www.businessinsider.com. March 30, 2013.

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• There is general agreement among researchers that nearly all stock pickers, whether they know it or not-and few of them do-are playing a game of chance.

  Daniel Kahneman

  Games, Agreement, Chance

  Daniel Kahneman (2011). “Thinking, Fast and Slow”, p.245, Macmillan

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• When you're underperforming the index, you go home at night and cry in your beer. It's not fun, but who said this business should be fun. We're too well paid to hang our heads and say boo hoo.

  Bill Gross

  Fun, Home, Beer

  "Bill Gross: 'Do I Wish I Had More Treasuries?'" by Courtney Comstock, www.businessinsider.com. August 29, 2011.

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• Perhaps there really are managers who can outperform the market consistently - logic would suggest that they exist. But they are remarkably well-hidden.

  Paul Samuelson

  Logic, Wells, Managers

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• The commission of the investment sins listed above is not limited to 'the little guy.' Huge institutional investors, viewed as a group, have long underperformed the unsophisticated index-fund investor who simply sits tight for decades. A major reason has been fees: Many institutions pay substantial sums to consultants who, in turn, recommend high-fee managers. And that is a fool's game.

  Warren Buffett

  Games, Long, Guy

  "Here are the 6 things Warren Buffett considers when making an investment" by Jeremy Schwartz, www.businessinsider.com. March 14, 2015.

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• Unfortunately, skill in evaluating the business prospects of a firm is not sufficient for successful stock trading, where the key question is whether the information about the firm is already incorporated in the price of the stock. Traders apparently lackthe skill to answer this crucial question, but they appear to be ignorant of their ignorance.

  Daniel Kahneman

  Ignorance, Successful, Skills

  Daniel Kahneman (2011). “Thinking, Fast and Slow”, p.247, Macmillan

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• Even if this advice to portfolio decision makers to drop dead is good advice, it obviously is not counsel that will be eagerly followed. Few people will commit suicide without a push. And fewer still will pay good money to be told to do what is against human nature and self-interest to do.

  Paul Samuelson

  Suicide, Self, People

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• Fund investors are confident that they can easily select superior fund managers. They are wrong.

  John C. Bogle

  Select, Fund, Managers

  John C. Bogle (2010). “The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns”, p.11, John Wiley & Sons

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• Everybody has some information. The function of the markets is to aggregate that information, evaluate it and get it incorporated into prices.

  Merton Miller

  Information, Function, Evaluate

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• Berkshire was built on the eternal verities: basic mathematics, basic horse sense, basic fear, and basic diagnosis of human nature to make predictions regarding human behavior. We stuck to the basics with a certain amount of discipline and it has worked out quite well.

  Charlie Munger

  Horse, Discipline, Diagnosis

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• The premise of this book is that it is easier to recognize other people's mistakes than your own.

  Daniel Kahneman

  Mistake, Book, People

  Daniel Kahneman (2011). “Thinking, Fast and Slow”, p.31, Macmillan

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• An intelligent investor gets satisfaction from the thought that his operations are exactly opposite to those of the crowd.

  Benjamin Graham

  Intelligent, Opposites, Crowds

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• The only certainty is that there is no certainty.

  Robert Rubin

  Certainty

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• Risk comes from not knowing what you are doing so wide diversification is only required when investors are ignorant. You only have to do a very few things in your life so long as you don't do too many things wrong.

  Warren Buffett

  Knowing, Long, Risk

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• I don't think the Federal Reserve has any role in how high rates are right now. I don't understand why everyone is paying attention to this tapering. The Fed is using one kind of bond to buy another kind of bond. What's the big deal, and why is anyone taking the Fed seriously?

  Eugene Fama

  Thinking, Attention, Tapering

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

  Benjamin Graham

  Book, Adoption, Purpose

  Benjamin Graham (2009). “The Intelligent Investor, Rev. Ed”, p.1, Harper Collins

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• If you roll dice, you know that the odds are one in six that the dice will come up on a particular side. So you can calculate the risk. But, in the stock market, such computations are bull - you don't even know how many sides the dice have!

  Nassim Nicholas Taleb

  Odds, Risk, Bulls

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• If Bill Gates woke up with Oprah's money he'd jump out the window.

  Chris Rock

  Bills, Window, Gates

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• 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.

  Benjamin Graham

  Mistake, Loss, Effort

  Benjamin Graham (2009). “The Intelligent Investor, Rev. Ed”, p.6, Harper Collins

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• We have not known a single person who has consistently or lastingly make money by thus "following the market". We do not hesitate to declare this approach is as fallacious as it is popular.

  Benjamin Graham

  Making Money, Approach, Single Person

  Benjamin Graham (2009). “The Intelligent Investor, Rev. Ed”, p.3, Harper Collins

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

  Benjamin Graham

  Ratios, Earning, Nonsensical

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• In an economy, an act, a habit, an institution, or a law, gives birth not only to an effect, but to a series of effects. Of these effects, the first only is immediate; it manifests itself simultaneously with its cause - it is seen. The others unfold in succession - they are not seen. Now this difference is enormous, for it is often true that when the immediate consequence is favorable, the ultimate consequences are fatal, and the converse.

  Frederic Bastiat

  Law, Differences, Giving

  "That Which Is Seen and That Which Is Not Seen". Book by Frédéric Bastiat, 1850.

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• [W]e think the very term 'value investing' is redundant. What is 'investing' if it is not the act of seeking value at least sufficient to justify the amount paid? Consciously paying more for a stock than its calculated value -- in the hope that it can soon be sold for a still-higher price -- should be labeled speculation (which is neither illegal, immoral nor -- in our view -- financially fattening).

  Warren Buffett

  Thinking, Views, Should

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