Sayings of value investors

Quotations from value investors

William Shakespeare

Oft expectation fails, and most oft there
where most it promises …

All’s well that ends well 2 iii 142

John Maynard Keynes

It happens, however, that the energies and skill of the professional investor and speculator are mainly occupied otherwise. For most of these persons are, in fact, largely concerned, not with making superior long-term of the probable yield of an investment over its whole life, but with foreseeing changes in the conventional basis of valuation a short time ahead of the general public. They are concerned, not with what an investment is really worth to a man who buys it “for keeps”, but with what the market will value it at, under the influence of mass psychology, three months or a year hence.

…

We have reached the third degree where we devote our intelligences to anticipating what average opinion expects average opinion to be.

The General Theory of Employment, Interest and Money (Ch 12 V)

Ben Graham and David Dodd (Security Analysis)

An investment operation is one which, upon thorough analysis, promises safety of principal and a satisfactory return. Operations not meeting these requirements are speculative.

Ben Graham

Imagine that in some private business you own a small share that cost you $1,000. One of your partners, named Mr Market, is very obliging indeed. Every day he tells you what he thinks your interest is worth and furthermore offers either to buy you out or to sell you an additional interest on that basis. Sometimes his idea of value appears plausible…. Often, on the other hand, Mr Market lets his enthusiasm or his fears run away with him, and the value he proposes seems to you little short of silly.

Thus, in sum, we say that to have a true investment there must be present a true margin of safety. And a true margin of safety is one that can be demonstrated by figures, by persuasive reasoning, and by reference to a body of actual experience.

The Intelligent Investor

You are neither right nor wrong because the crowd disagrees with you.
We know from experience that eventually the market catches up with value.

Charlie Munger

I would never invest in gold: even if it works, you’re a jerk.

Merryn Somerset Webb

Yes, it is risky, but I’d rather hold something priced for failure which might not come than something priced for perfection that definitely won’t.

Financial Times 8-Feb-14

Warren Buffett

In an area where much looks foolish within weeks or months after publication, Ben [Graham]’s principles have remained sound – their value often enhanced and better understood in the wake of financial storms that demolished flimsier intellectual structures. His counsel of soundness brought unfailing rewards to his followers -even to those with natural abilities inferior to more gifted practitioners, who stumbled while following counsels of brilliance or fashion.

To invest successfully over a lifetime does not require a stratospheric IQ, unusual business insights, or inside information. What’s needed is a sound intellectual framework for making decisions and the ability to keep emotions from corroding that framework. [The Intelligent Investor] precisely and clearly prescribes the proper framework. You must supply the emotional discipline.

Value is what you get; price is what you pay.

What is “investing” if it is not the act of seeking value at least sufficient to justify the amount paid? Consciously paying more for a stock than its calculated value-in the hope that it can soon be sold for a still-higher price – should be labelled speculation ……

You try to be greedy when others are fearful and you try to be very fearful when others are greedy.

Uncertainty actually is the friend of the buyer of long-term values.

Now is the time to invest and get rich.(October 1974).

I call investing the greatest business in the world because you never have to swing. You stand at the plate, the pitcher throws you General Motors at 47! US Steel at 39! And nobody calls a strike on you. There’s no penalty except opportunity lost. All day you wait for the pitch you like; then when the fielders are asleep, you step up and hit it.

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.

That which is not worth doing is not worth doing well.

I would no more take an investment banker’s opinion on whether to do a deal than I would ask a barber whether I needed a haircut.

When you go into a poker game, you look around, there is always one patsy. If you look around and you can’t tell who the patsy is, that’s ’cause it’syou.

Only two people understand [interest rates]. Both of them live in Switzerland. However, they’re diametrically opposed to one another.

Maybe grapes from a little eight-acre vineyard in France are really the best in the whole world, but I have always had a suspicion that about 99% of it is in the telling and about 1% is in the drinking.