The Intelligent Investor

Those who do not remember the past are condemned to repeat it.

Never mingle your speculative and investment operations in the same account, nor in any part of your thinking.

Obvious prospects for physical growth in a business do not translate into obvious profits for investors.

The intelligent investor should seek to maximize the number of holdings that offer 'a better chance for profit than for loss.

The stock market often goes far wrong, and sometimes an alert and courageous investor can take advantage of its patent errors.

The True investor scarcely ever is forced to sell his shares, and at all other times he is free to disregard the current price quotation.

The intelligent investor should recognize that market quotations are there for his convenience, either to be taken advantage of or to be ignored.

The investor's chief problem—and even his worst enemy—is likely to be himself.

An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return.

The intelligent investor is a realist who sells to optimists and buys from pessimists.

The future of security prices is never predictable.

To keep investing from decaying into gambling, you must diversify.

The common intellectual theme of the investors from Graham-and-Doddsville is this: they search for discrepancies between the value of a business and the price of small pieces of that business in the market.

When you build a bridge, you insist it can carry 30,000 pounds, but you only drive 10,000-pound trucks across it. And that same principle works in investing.

Investment is most intelligent when it is most businesslike.

Investing on the basis of projection is a fool’s errand; even the forecasts of the so-called experts are less reliable than the flip of a coin.

Taking the inverse of that number (by dividing 4.6 into 100), we can derive a 'suggested maximum' P/E ratio of 21.7.

The market’s valuation of a given stock is the result of a vast, continuous, real-time operation of collective intelligence.

Value stocks outperform growth stocks over long periods.

Asset backing and book value are synonyms.

The margin of safety is the difference between the percentage rate of the earnings on the stock at the price you pay for it and the rate of interest on bonds.

There is no such thing as a good or bad stock; there are only cheap stocks and expensive stocks.

Speculation is buying on the hope that a stock’s price will keep going up, while investing is buying on the basis of what the underlying business is worth.