Quotes

Let us define the speculator as one who seeks to profit from market movements, without primary regard to intrinsic values; the "prudent stock investor" as one who (a) buys only at prices amply supported by underlying value, and (b) who determinedly reduces his stock holdings when the market enters the speculative phase of a sustained advance.

Participation in the stock market is not limited to the experienced, the conservative, nor even the intelligent. It is a game at which any number of people may play. And as the market level rises, the quantity of players grows rapidly and their quality diminishes somewhat in proportion.

The only significance of stock market gyrations to the true investor is that they give him an opportunity to buy good common stocks when they are cheap -- or at least reasonably priced -- and at times offer him an invitation to sell out at temptingly high levels.

A common stock investor is one who regards his common stock holdings as a proprietary interest in various businesses, not as a series of quotations in a newspaper.

The true measure of common stocks values, of course, is not found by reference to price movements alone, but by price in relation to earnings, dividends, future prospects and, to a small extent, asset values.

The chief hazard of a careful common stock program is not that it may bring unexpected losses, but that its profits will turn the investor into a speculator greedy for quicker and bigger gains -- and therefore headed for ultimate disaster.

My experience teaches me that by far the largest losses have been sustained by investors through buying securities of inferior quality under favorable general conditions.

It is an axiom of investment that securities should be purchased because the buyer believes in their soundness, and not because he needs a certain income.

In the halcyon days of prosperity, the investor is satisfied with increased dividends and a rising market, and cares very little about dry statistics.

Investors venerate their old gods long after their divinity is departed.

The Street, unfortunately, is fairly well inured to the bursting of bubbles.

To my mind, the so-called growth-stock investor -- or the average security analyst for that matter -- has no idea of how much to pay for a growth stock, how many stocks to buy to obtain the desired return, or how their prices will behave.