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General Investing
"Don't gamble. Take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it"
Will Rogers
"A rising tide lifts all boats. It's not until the tide goes out that you realize who's swimming naked."
Warren Buffett
"We must always think about things, and we must think about things as they are, not as they are said to be."
George Bernard Shaw, Playwright
"Don't just do something, stand there!"
Charles Ellis, "Winning the Loser's Game"
"Just making money is not enough anymore. Now we have to worry about our money making money."
Woody Allen, American Filmmaker
"Statistics show that investing your money in the stock market is nearly twice as secure as feeding it to otters."
Dave Berry, Columnist
"Odds are you don't know what the odds are? (contributed by Munzer Haque)"
Belsky, Gary and Thomas Gilovich
"The average long-term experience investing is never surprising, but the short term experience is always surprising. We now know to focus not on rate of return, but on the informed management of risk."
Charles Ellis
"In investing, what is comfortable is rarely profitable."
Robert Arnott
"Those who are ignorant of investment history are bound to repeat it. Historical investment returns and risks of various asset classes should be studied. Investment results for an asset over a long enough period (greater than 20 years) are a good guide to the future returns and risks of that asset. Further, it should be possible to approximate the future long-term and risk of a portfolio consisting of such assets."
William Bernstein
"Risk is good. Not properly managing your risk is a dangerous leap."
Evel Knievel, Motorcyclist
"If I have noticed anything over these 60 years on Wall Street, it is that people do not succeed in forecasting what's going to happen to the stock market."
Benjamin Graham, Legendary Investor and Author
"If you are prepared to do something stupid repeatedly, there are many professionals happy to take your money."
Richard H. Thaler, "The Winner's Curse"
"Ignore market timers, Wall Street strategists, technical analysts, and bozo journalists who make market predictions...Admit to your therapist that you can't beat the market. Investors would also benefit by remembering this simple phrase: trading is hazardous to your wealth."
Jonathan Clements, Columnist, Wall Street Journal
"Investment Policy (asset allocation) is the foundation upon which portfolios should be constructed and managed."
Charles Ellis
"Investment planning is about structuring exposure to risk factors."
Gene Fama Jr.
"About diversification: One buys two of everything and in the end owns a zoo."
Warren Buffett
"'Tis the part of a wise man to keep himself today for tomorrow, and not venture all his eggs in one basket."
Miguel de Cervantes
"The great investor Benjamin Graham once defined happiness as 'living well within one's means.' Did he mean 'living well within one's means' or 'living well within one's means'? I think his ambiguity was intentional: He meant both."
Jason Zweig, The Little Book of Safe Money
Market Timing
“Our stay-put behavior reflects our view that the stock market serves as a relocation center at which money is moved from the active to the patient.”
Warren Buffett
“We continue to make more money when snoring than when active.”
Warren Buffett
“The only value of stock forecasters is to make fortune-tellers look good.”
Warren Buffett
“My favorite time frame is forever.”
Warren Buffet
“Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves.”
Peter Lynch
“I can’t recall ever once having seen the name of a market timer on Forbes‘ annual list of the richest people in the world. If it were truly possible to predict corrections, you’d think somebody would have made billions by doing it.”
Peter Lynch
“Whenever some analyst seems to know what he’s talking about, remember that pigs will fly before he’ll ever release a full list of his past forecasts, including the bloopers.”
Jason Sweig
“‘Market timing’ is unappealing to long-term investors. As in hunting deer or fishing for rainbow trout, investors have learned the importance of ‘being there’ and using patient persistence — so they are there when opportunity knocks.”
Charles Ellis
“What to do when the market goes down? Read the opinions of the investment gurus who are quoted in the WSJ. And, as you read, laugh. We all know that the pundits can’t predict short-term market movements. Yet there they are, desperately trying to sound intelligent when they really haven’t got a clue.”
Jonathan Clements
“Do you know what investing for the long run but listening to market news everyday is like? It’s like a man walking up a big hill with a yo-yo and keeping his eyes fixed on the yo-yo instead of the hill.”
Alan Ableson
“Only liars manage to always be out during bad times and in during good times.”
Bernard Baruch
“Market timing is impossible to perfect.”
Mark Rieppe
“It must be apparent to intelligent investors that if anyone possessed the ability to do so [forecast the immediate trend of stock prices] consistently and accurately he would become a billionaire so quickly he would not find it necessary to sell his stock market guesses to the general public.”
David L. Babson & Company
“Let’s say it clearly: No one knows where the market is going-experts or novices, soothsayers or astrologers. That’s the simple truth.”
Fortune
“A decade of results throws cold water on the notion that strategists exhibit any special ability to time the markets.”
The Wall Street Journal
Investment Mistakes
“If you want to see the greatest threat to your financial future, go home and take a look in the mirror.“
Jonathan Clements
“The belief that bear markets favor active management is a myth. A majority of active funds in eight of the nine domestic equity style boxes were outperformed by indices in the negative markets of 2008. The bear market of 2000 to 2002 showed similar outcomes.”
Standard & Poor’s Indices Versus Active Funds, Scorecard, Year End 2008
“Properly measured, the average actively managed dollar must underperform the average passively managed dollar, net of costs. Empirical analyses that appear to refute this principle are guilty of improper measurement.”
Nobel Prize winner William Sharpe
“Investors spend an absurd amount of time trying to control the one thing they can do the least about, which is their raw investment performance. They attempt to pick hot stocks, find star fund managers and guess the market’s direction. Yet it is extraordinarily difficult, if not impossible, to do any of these things.“
Jonathan Clements
Mutual Funds
“I have become increasingly convinced that the past records of mutual fund managers are essentially worthless in predicting future success. The few examples of consistently superior performance occur no more frequently than can be expected by chance.”
Burton G. Malkiel, Author of A Random Walk Down Wall Street, Professor of Economics at Princeton
“Overwhelmingly, mutual funds extract enormous sums from investors in exchange for providing a shocking disservice.”
David Swensen, CIO of the Yale Endowment Fund
“For professional investors like myself, a sense of humor is essential. We are very aware that we are competing not only against the market averages but also against one another. It's an intense rivalry. We are each claiming that, ‘The stocks in my fund today will perform better than what you own in your fund.’ That implies we think we can predict the future, which is the occupation of charlatans. If you believe you or anyone else has a system that can predict the future of the stock market, the joke is on you.”
Ralph Wanger
“The mutual fund and brokerage industries belittle indexing because it is deadly competition for their higher margin products. The financial media ignore it because it makes such lousy copy.”
Gregory Baer and Gary Gensler, The Great Mutual Fund Trap
“With all that is known about the poor results of active stock picking, why do so many investors still buy high-cost mutual funds or churn their stock portfolios? One major reason is because they are told to do so, every day, explicitly or implicitly, by the financial media and Wall Street.”
Gregory Baer and Gary Gensler, The Great Mutual Fund Trap
“The striking similarities in net performance patterns over time makes skill differences highly unlikely.”
Rob Bauer and Rik Frehen, The Performance of U.S. Pension Funds. January 28, 2008.
“Economists cannot predict the turning points in the economy.”
William Sherden
“There are no economic forecasters who consistently lead the pack in forecasting accuracy.”
William Sherden
“There are no economic ideologies that produce consistently superior economic forecasts.”
William Sherden
“Increased sophistication provides no improvement in economic forecast accuracy.”
William Sherden
“Consensus forecasts offer little improvement.”
William Sherden
“Despite recent innovations in information technology and decades of academic research, successful stock market prediction has remained an elusive goal.”
“Overall, we have not made progress in predicting the stock market, but this has not stopped the investment business from continuing the quest, and making $100 billion annually doing so.”
William Sherden
“We have two classes of forecasters: those who don’t know — and those who don’t know they don’t know.”
John Kenneth Galbraith
“The problem with macro [economic] forecasting is that no one can do it.”
Michael Evans
“If I have noticed anything over these 60 years on Wall Street, it is that people do not succeed in forecasting what’s going to happen to the stock market.”
Benjamin Graham
“No matter how much evidence exists that seers do not exist, suckers will pay for the existence of seers.”
J. Scott Armstrong, The Wharton School, University of Pennsylvania
“You make more money selling the advice than following it.”
Steve Forbes, quoting his grandfather who founded Forbes magazine
“[Investors] think of the so-called professionals … as having all the advantages. That is total crap. … They'd be better off in an index fund.”
Peter Lynch
“Most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that charges minimal fees. Those following this path are sure to beat the net results (after fees and expenses) delivered by the great majority of investment professionals.”
Warren Buffett
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