Stock Market Wisdom Quotes

When you were making excuses someone else was making enterprise.

What happened was, I got the idea in my head-and I could not get it out ㅡ that college was just one more dopey, inane place in the world dedicated to piling up treasure on earth and everything. I mean treasure is treasure, for heaven's sake. What's the difference whether the treasure is money, or property, or even culture, or even just plain knowledge? It all seemed like exactly the same thing to me, if you take off the wrapping ㅡ and it still does! Sometimes I think that knowledge ㅡ when it's knowledge for knowledge's sake, anyway ㅡ is the worst of all. The least excusable, certainly. [...] I don't think it would have all got me quite so down if just once in a while ㅡ just once in a while ㅡ there was at least some polite little perfunctory implication that knowledge should lead to wisdom, and that if it doesn't, it's just a disgusting waste of time! But there never is! You never even hear any hints dropped on a campus that wisdom is supposed to be the goal of knowledge. You hardly ever even hear the word 'wisdom' mentioned! Do you want to hear something funny? Do you want to hear something really funny? In almost four years of college ㅡ and this is the absolute truth ㅡ in almost four years of college, the only time I can remember ever even hearing the expression 'wise man' being used was in my freshman year, in Political Science! And you know how it was used? It was used in reference to some nice old poopy elder statesman who'd made a fortune in the stock market and then gone to Washington to be an adviser to President Roosevelt. Honestly, now! Four years of college, almost! I'm not saying that happens to everybody, but I just get so upset when I think about it I could die.

Life seems to be like a stock market... Where relationships are traded... Can't judge when the value of a relationship will go high or low...!

When good things are so low that no one wants them, I buy them and lay them away in the safe; when owing to some new development, they go up and my shares are so needed that men will pay well for them, I am ready to sell.

मान लीजिए जिसको शेयर बाजार के बारे में इतना बुझाएगा ...उ बैठ के टीवी पर बताएगा कि खुद पैसा बनाएगा ?

Stock market doesn't only teaches to make money but it also teaches lot about life, patience, persistence and wisdom.

On 3 timeless ideas for investing Benjamin Graham, three fundamentally basic ideas: 1. You should look at stocks as part of ownership of a business. 2. You should look at market fluctuations in terms of his "Mr. Market" example & make them your friend rather than your enemy by essentially profiting from folly rather participating in it, & finally, 3. The 3 most important words in investing are "margin of safety" - ...always building a 15,000 pound bridge if you're going to be driving 10,000 pound truck across it...

If you chart the gambler’s fortunes over time, what you find is the gambler wins for a period, or loses for a period. In other words, everything in the world goes in streaks. It’s a real phenomenon, and you see it everywhere: in weather, in river flooding, in baseball, in heart rhythms, in stock markets. Once things go bad, they tend to stay bad. Like the old folk saying that bad things come in threes. Complexity theory tells us the folk wisdom is right. Bad things cluster. Things go to hell together. That’s the real world.

The tyro knows nothing, and everybody, including himself, knows it. But the next, or second, grade thinks he knows a great deal and makes others feel that way too. He is the experienced sucker, who has studied not the market itself but a few remarks about the market made by a still higher grade of suckers. The second-grade sucker knows how to keep from losing his money in some of the ways that get the raw beginner. It is this semisucker rather than the 100 per cent article who is the real all-the-year-round support of the commission houses. He lasts about three and a half years on an average, as compared with a single season of from three to thirty weeks, which is the usual Wall Street life of a first offender. It is naturally the semisucker who is always quoting the famous trading aphorisms and the various rules of the game. He knows all the don'ts that ever fell from the oracular lips of the old stagers excepting the principal one, which is: Don't be a sucker! This semisucker is the type that thinks he has cut his wisdom teeth because he loves to buy on declines. He waits for them. He measures his bargains by the number of points it has sold off from the top. In big bull markets the plain unadulterated sucker, utterly ignorant of rules and precedents, buys blindly because he hopes blindly. He makes most of the money until one of the healthy reactions takes it away from him at one fell swoop. But the Careful Mike sucker does what I did when I thought I was playing the game intelligently according to the intelligence of others. I knew I needed to change my bucket-shop methods and I thought I was solving my problem with any change, particularly one that assayed high gold values according to the experienced traders among the customers.

We define a bargain issue as one which, on the basis of facts established by analysis, appears to be worth considerably more than it is selling for. The genus includes bonds and preferred stocks selling well under par, as well as common stocks. To be as concrete as possible, let us suggest that an issue is not a true “bargain” unless the indicated value is at least 50% more than the price. What kind of facts would warrant the conclusion that so great a discrepancy exists? How do bargains come into existence, and how does the investor profit from them? There are two tests by which a bargain common stock is detected. The first is by the method of appraisal. This relies largely on estimating future earnings and then multiplying these by a factor appropriate to the particular issue. If the resultant value is sufficiently above the market price—and if the investor has confidence in the technique employed—he can tag the stock as a bargain. The second test is the value of the business to a private owner. This value also is often determined chiefly by expected future earnings—in which case the result may be identical with the first. But in the second test more attention is likely to be paid to the realizable value of the assets, with particular emphasis on the net current assets or working capital. At low points in the general market a large proportion of common stocks are bargain issues, as measured by these standards. (A typical example was General Motors when it sold at less than 30 in 1941, equivalent to only 5 for the 1971 shares. It had been earning in excess of $4 and paying $3.50, or more, in dividends.) It is true that current earnings and the immediate prospects may both be poor, but a levelheaded appraisal of average future conditions would indicate values far above ruling prices. Thus the wisdom of having courage in depressed markets is vindicated not only by the voice of experience but also by application of plausible techniques of value analysis.

You can gain great insights about investing from a careful study of Buffett’s Generals. He was constantly appraising the value of as many stocks as he could find, looking for the ones where he felt he had a reasonable ability to understand the business and come up with an estimate for its worth. With a prodigious memory and many years of intense study, he built up an expansive memory bank full of these appraisals and opinions on a huge number of companies. Then, when Mr. Market offered one at a sufficiently attractive discount to its appraised value, he bought it; he often concentrated heavily in a handful of the most attractive ones. Good valuation work and proper temperament have always been the two keys pillars of his success as an investor. Buffett

The course of the stock market will determine, to a great degree, when we will be right, but the accuracy of our analysis of the company will largely determine whether we will be right. In other words, we tend to concentrate on what should happen, not when it should happen.”7 This

a declining Dow gives us our chance to shine and pile up the percentage advantages which, coupled with only an average performance during advancing markets, will give us quite satisfactory long-term results. Our target is an approximately ½% decline for each 1% decline in the Dow and if achieved, means we have a considerably more conservative vehicle for investment in stocks than practically any alternative.8 Buffett

Not only were the best forecasters foxy as individuals, they had qualities that made them particularly effective collaborators—partners in sharing information and discussing predictions. Every team member still had to make individual predictions, but the team was scored by collective performance. On average, forecasters on the small superteams became 50 percent more accurate in their individual predictions. Superteams beat the wisdom of much larger crowds—in which the predictions of a large group of people are averaged—and they also beat prediction markets, where forecasters “trade” the outcomes of future events like stocks, and the market price represents the crowd prediction. It might seem like the complexity of predicting geopolitical and economic events would necessitate a group of narrow specialists, each bringing to the team extreme depth in one area. But it was actually the opposite. As with comic book creators and inventors patenting new technologies, in the face of uncertainty, individual breadth was critical. The foxiest forecasters were impressive alone, but together they exemplified the most lofty ideal of teams: they became more than the sum of their parts. A lot more.

it's rather interesting because one of the greatest economists of the world is a substantial shareholder in Berkshire Hathaway and has been from the very early days after Buffett was in control. His textbook always taught that the stock market was perfectly efficient and that nobody could beat it.But his own money went into Berkshire and made him wealthy. So, like Pascal in his famous wager, he hedged his bet.The iron rule of life is that only twenty percent of the people can be in the top fifth Is the stock market so efficient that people can't beat it? Well, the efficient market theory is obviously roughly right-meaning that markets are quite efficient and it's quite hard for anybody to beat the market by significant margins as a stock picker by just being intelligent and working in a disciplined way.Indeed, the average result has to be the average result. By definition, everybody can't beat the market.

There was now an accounting convention in the United States that, provided employees were first given options, required that when easily marketable stock was issued to employees at a below-market price, the bargain element for the employees, although roughly equivalent to cash, could not count as compensation expense in determining a company's reported profits. This amazingly peculiar accounting convention had been selected by the accounting profession, over the objection of some of its wisest and most ethical members, because corporate managers, by and large, preferred that their gains from exercising options covering their employers' stock not be counted as expense in determining their employers' earnings. The accounting profession, in making its amazingly peculiar decision, had simply followed the injunction so often followed by persons quite different from prosperous, entrenched accountants. The injunction was that normally followed by insecure and powerless people: "Whose bread I eat, his song I sing.

In large part, companies obtain the shareholder constituency that they seek and deserve. If they focus their thinking and communications on short-term results or short-term stock market consequences they will, in large part, attract shareholders who focus on the same factors

We don’t buy and sell stocks based upon what other people think the stock market is going to do (I never have an opinion) but rather upon what we think the company is going to do.

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. He need pay attention to it and act upon it only to the extent that it suits his book, and no more. Thus the investor who permits himself to be stampeded or unduly worried by unjustified market declines in his holdings is perversely transforming his basic advantage into a basic disadvantage. That man would be better off if his stocks had no market quotation at all, for he would then be spared the mental anguish caused him by other persons’ mistakes of judgment.10

I resurrect this “market-guessing” section only because after the Dow declined from 995 at the peak in February to about 865 in May, I received a few calls from partners suggesting that they thought stocks were going a lot lower. This always raises two questions in my mind: (1) if they knew in February that the Dow was going to 865 in May, why didn’t they let me in on it then; and, (2) if they didn’t know what was going to happen during the ensuing three months back in February, how do they know in May? There is also a voice or two after any hundred point or so decline suggesting we sell and wait until the future is clearer. Let me again suggest two points: (1) the future has never been clear to me (give us a call when the next few months are obvious to you—or, for that matter the next few hours); and, (2) no one ever seems to call after the market has gone up one hundred points to focus my attention on how unclear everything is, even though the view back in February doesn’t look so clear in retrospect. If

If a 20% or 30% drop in the market value of your equity holdings (such as BPL) is going to produce emotional or financial distress, you should simply avoid common stock type investments. In the words of the poet—Harry Truman—“If you can’t stand the heat, stay out of the kitchen.” It is preferable, of course, to consider the problem before you enter the “kitchen.

I am not in the business of predicting general stock market or business fluctuations. If you think I can do this, or think it is essential to an investment program, you should not be in the partnership.

The market, like the Lord, helps those who help themselves. But, unlike the Lord, the market does not forgive those who know not what they do. For the investor, a too-high purchase price for the stock of an excellent company can undo the effects of a subsequent decade of favorable business developments.

We have believed for many years that investors will be much better off bowing to the wisdom of the market and investing in low-cost, broad-based index funds, which simply buy and hold all the stocks in the market as a whole. As more and more evidence accumulates, we have become more convinced than ever of the effectiveness of index funds. Over 10-year periods, broad stock market index funds have regularly outperformed two-thirds or more of the actively managed mutual funds.

You Can Be a Stock Market Genius, The Little Book That Beats the Market, The Little Book That Still Beats the Market, and The Big Secret for the Small Investor.

its trend. And right here let me say one thing: After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: It never was my thinking that made the big money for me. It always was my sitting. Got that? My sitting tight! It is no trick at all to be right on the market. You always find lots of early bulls in bull markets and early bears in bear markets. I've known many men who were right at exactly the right time, and began buying or selling stocks when prices were at the very level which should show the greatest profit. And their experience invariably matched mine—that is, they made no real money out of it. Men who can both be right and sit tight are uncommon. I found it one of the hardest things to learn. But it is only after a stock operator has firmly grasped this that he can make big money. It is literally true that millions come easier to a trader after he knows how to trade than hundreds did in the days of his ignorance.

Wisdom That Has Stood the Test of Time… DECISIVENESS The world is moving faster and faster. Stock market trades are made in milliseconds. Deals come and go on the Internet in a matter of minutes. More and more people are competing for good deals. So the faster you can make a decision the more likely you’ll be able to seize opportunities — before someone else does.

Our investment style has been given a name-focus investing-which implies ten holdings, not one hundred or four hundred. The idea that it is hard to find good investments. So concentrate in a few, seems to me to be an obviously good idea. But ninety-eight percent of the investment world doesn't think this way. It's been good for us-and you-that we've done this.What's funny is that most big investment organizations don't think like this. They hire lots of people, evaluate Merck vs. Pfizer and every stock in the S&P 500, and think they can beat the market. You can't do it.

The most robust evidence indicates that this wisdom-of-crowds principle holds when forecasts are made independently before being averaged together. In a true betting market (including the stock market), people can and do react to one another’s behavior.

life is rich even if you are not.---things are happening everyday, good and bad, and that it was just a matter of deciding what I wanted to be part of.

After 28 years at this post, and 22 years before this in money management, I can sum up whatever wisdom I have accumulated this way: The trick is not to be the hottest stock-picker, the winningest forecaster, or the developer of the neatest model; such victories are transient. The trick is to survive! Performing that trick requires a strong stomach for being wrong because we are all going to be wrong more often then we expect. The future is not ours to know. But it helps to know that being wrong is inevitable and normal, not some terrible tragedy, not some awful failing in reasoning, not even bad luck in most instances. Being wrong comes with the franchise of an activity whose outcome depends on an unknown future . . . (Jeff Saut, “Being Wrong and Still Making Money,” Seeking Alpha, March 13, 2017, emphasis added)

shows the most difficult environment: a probabilistic domain with high degrees of freedom. Here the evidence clearly shows that collectives outperform experts.8 The stock market provides an obvious case in point, and it comes as no surprise that the vast majority of investors add no value. In this domain, experts can, and often do, hold diametrically opposite views on the same issue.9

inaction and patience are almost always the wisest options for investors in the stock market. For the same reason, I find it better not to check the performance of my stocks every day (or, for that matter, every week) since this makes it harder to keep a long-term focus.

It takes wisdom to know what we don’t know

[M]any people say things like ‘investing in a love relationship’ as if they are talking about investing in stock market or in financial projects. That is a customer not a human or a citizen language. This type of language is filled with clues about how we have internalized ourselves as customers.

The Bayesian Invisible Hand … free-market capitalism and Bayes’ theorem come out of something of the same intellectual tradition. Adam Smith and Thomas Bayes were contemporaries, and both were educated in Scotland and were heavily influenced by the philosopher David Hume. Smith’s 'Invisible hand' might be thought of as a Bayesian process, in which prices are gradually updated in response to changes in supply and demand, eventually reaching some equilibrium. Or, Bayesian reasoning might be thought of as an 'invisible hand' wherein we gradually update and improve our beliefs as we debate our ideas, sometimes placing bets on them when we can’t agree. Both are consensus-seeking processes that take advantage of the wisdom of crowds. It might follow, then, that markets are an especially good way to make predictions. That’s really what the stock market is: a series of predictions about the future earnings and dividends of a company. My view is that this notion is 'mostly' right 'most' of the time. I advocate the use of betting markets for forecasting economic variables like GDP, for instance. One might expect these markets to improve predictions for the simple reason that they force us to put our money where our mouth is, and create an incentive for our forecasts to be accurate. Another viewpoint, the efficient-market hypothesis, makes this point much more forcefully: it holds that it is 'impossible' under certain conditions to outpredict markets. This view, which was the orthodoxy in economics departments for several decades, has become unpopular given the recent bubbles and busts in the market, some of which seemed predictable after the fact. But, the theory is more robust than you might think. And yet, a central premise of this book is that we must accept the fallibility of our judgment if we want to come to more accurate predictions. To the extent that markets are reflections of our collective judgment, they are fallible too. In fact, a market that makes perfect predictions is a logical impossibility.

The market is not affected by what a million people think about the market, but it is immediately affected by their actual buying and selling or their failure to do either.

He made $3 million in a single day, went bankrupt four times, and was blamed for the crash of 1929. Jesse Livermore tells how he did it. Considered to be one of the greatest traders of all time, stock market legend Jesse Livermore made and lost vast fortunes and lived a life that typified the highs and lows of the 1920s and 1930s. So influential was he that many credit him with having caused the crash of 1929. And while America sank into ten long years of the Great Depression, Livermore went short--and made $100 million. Written by Livermore in 1940, the last year of his life, "How to Trade in Stocks" distills the wisdom of his 40 years as a trader. It combines fascinating autobiographical and historical details with step-by-step guidance through the Livermore trading system. Investors learn his prescriptions for analyzing the leading sectors, understanding timing, money management, emotional control, and more.

I discovered something else, and that is that suckers differ among themselves according to the degree of experience. The tyro knows nothing, and everybody, including himself, knows it. But the next, or second, grade thinks he knows a great deal and makes others feel that way too. He is the experienced sucker, who has studied not the market itself but a few remarks about the market made by a still higher grade of suckers. The second-grade sucker knows how to keep from losing his money in some of the ways that get the raw beginner. It is this semisucker rather than the 100 per cent article who is the real all-the-year-round support of the commission houses. He lasts about three and a half years on an average, as compared with a single season of from three to thirty weeks, which is the usual Wall Street life of a first offender. It is naturally the semisucker who is always quoting the famous trading aphorisms and the various rules of the game. He knows all the don'ts that ever fell from the oracular lips of the old stagers excepting the principal one, which is: Don't be a sucker! This semisucker is the type that thinks he has cut his wisdom teeth because he loves to buy on declines. He waits for them. He measures his bargains by the number of points it has sold off from the top. In big bull markets the plain unadulterated sucker, utterly ignorant of rules and precedents, buys blindly because he hopes blindly. He makes most of the money until one of the healthy reactions takes it away from him at one fell swoop. But the Careful Mike sucker does what I did when I thought I was playing the game intelligently according to the intelligence of others. I knew I needed to change my bucket-shop methods and I thought I was solving my problem with any change, particularly one that assayed high gold values according to the experienced traders among the customers.

There is something special about this precious man. He carries so much worth. His worth surpasses indices in stock markets—a man of sheer grace and diligence.

He puts his revenue into ventures that will bring him higher returns, because he is a reasonable man. When others chase fleeting gains, he studies the markets. Each investment, be it financial or emotional, is well calculated. He weighs risks, considers dividends, and carefully diversifies in the process. His revenue comes from prudent decisions, not recklessness. His mind's stock exchange thrives on reason, and it yields significant dividends.

Wisdom is a product of knowledge and experience.

Although the contours of this new world were visible well before 1959, the old relationships in the capital markets tended to persist as long as people with memories of the old days continued to be the main investors. For example, my partners, veterans of the Great Crash, kept assuring me that the seeming trend was nothing but an aberration. They promised me that matters would revert to normal in just a few months, that stock prices would fall and bond prices would rally. I am still waiting. The fact that something so unthinkable could occur has had a lasting impact on my view of life and on investing in particular. It continues to color my attitude toward the future and has left me skeptical about the wisdom of extrapolating from the past.