Wisdom of Great Investors



1. Keep Your Emotions in Check

“The investors chief problem – and his worst enemy – is likely to be himself.  In the end, how much your investments behave is much less important than how you behave.”
- Benjamin Graham, widely known as the father of value investing

“A lot of people with high IQs are terrible investors because they’ve got terrible temperaments.  You need to keep raw, irrational emotion under control.”
– Charlie Munger, Vice Chairman of Berkshire Hathaway

“Your success in investing will depend in part on your character and guts and in part on your ability to realize, at the height of ebullience and the depth of despair alike, that this too, shall pass.”
– Jack Bogle, found of The Vanguard Group

2.  Don’t Blindly Trust Forecasts

“Thousands of experts study overbought indicators, head-and-shoulder patterns, put-call ratios, the Fed’s policy on money supply…and they don’t predict markets with any useful consistency, any more than the gizzard squeezers could tell the Roman emperors when the Huns would attack.”
– Peter Lynch, manager of the Fidelity Magellan Fund 1977-1990

“I make no attempt to forecast the market – my efforts are devoted to finding undervalued securities.”
– Warren Buffett, American business magnate, investor, and philanthropist

3.  Don’t Try to Time the Market

“The idea that a bell rings to signal when to get into or out of the stock market is simply not credible.  After nearly fifty years in this business, I don’t know anybody who has done it successfully and consistently.  I don’t even know anybody who knows anybody who has.”
– Jack Bogle, founder of The Vanguard Group

“Far more money has been lost by investors trying to anticipate corrections, than lost in the corrections themselves.”
– Peter Lynch, manager of the Fidelity Magellan Fund 1977-1990

4.  Be Patient and Think Long Term

“The stock market is a device to transfer money from the impatient to the patient.” 
- Warren Buffett, American business magnate, investor, and philanthropist

“Invest for the long haul. Don’t get greedy and don’t get too scared.
– Shelby M.C. Davis, American businessman and philanthropist

“The best way to measure your investing success is not by whether you’re beating the market but by whether you’ve put in place a financial plan and a behavioral discipline that are likely to get you where you want to go.”
– Benjamin Graham, known as the father of value investing

“Waiting helps you as an investor and a lot of people just can’t stand to wait.  If you didn’t get the deferred-gratification gene, you’ve got to work very hard to overcome that.”
- Charlie Munger, Vice Chairman of Berkshire Hathaway

5.  A Market Correction is an Opportunity

“A market downturn doesn’t bother us.  It is an opportunity to increase our ownership of great companies with great management at good prices.”
– Warren Buffett, American business magnate, investor, and philanthropist

“The intelligent investor is a realist who sells to optimists and buys from pessimists.”
- Benjamin Graham, known as the father of value investing

“You make the most of your money in a bear market, you just don’t realize it at the time.”  
- Shelby M.C. Davis, American businessman and philanthropist

6.  Markets Fluctuate.  Stay the Course

“History provides a crucial insight regarding market crises:  they are inevitable, painful and ultimately surmountable”
- Shelby M.C. Davis, American businessman and philanthropist

“In the short run, the market is a voting machine.  In the long run, it is a weighing machine.”
- Benjamin Graham, known as the father of value investing

“A 10% decline in the market is fairly common – it happens about once a year.  Investors who realize this are less likely to sell in a panic, and more likely to remain invested, benefitting from the wealthbuilding power of stocks. 
- Christopher Davis, Manager of the Davis Group