As a student of the stealthy and wealthy lifestyle, I have been spending a lot of time diving into investing and trying to understand the fundamentals of how to grow money over time. As part of this exercise, I have started to compile a notebook of the best investing quotes that I have heard from the greats like Warren Buffett, George Soros and Benjamin Graham. I’ve narrowed that list down to some of my all-time favorites, which can help to guide you on your quest for financial freedom.
The best investing quotes of all time
“Buy not on optimism, but on arithmetic.” – Benjamin Graham
The main point to remember with any investment is that it all comes down to math. If there is mathematical value, you can expect to make money. It doesn’t matter if you think the company is “cool” or “smart” or if your cousin tells you it is a hot investment. If you are putting your money into something, ensure that it makes sense financially before you ever start to think twice about it.
“In investing, what is comfortable is rarely profitable.” – Robert Arnott
When you are trying to grow your money in a security, you are basically betting for or against a future outcome. In many cases, you will be betting against what the masses think is going to happen. Get used to being uncomfortable. The majority of investors out there are comfortable with their investments and that is why most investors consistently underperform against the market.
“If investing is entertaining, if you’re having fun, you’re probably not making any money. Good investing is boring.” – George Soros
You are not playing blackjack. You are not betting on a sports team or a horse or a coin flip. You are purchasing a portion of a company or an even smaller portion of a collection of companies. Becoming an investor in a business is not supposed to be a means of entertaining you. That is what family, movies and the great outdoors are for. Look for investments that are smart, not fun.
“I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.” – Warren Buffett
If you have hopes of outperforming the market, you must do things that other people are not doing. They ARE the market. Don’t be afraid to be intelligently contrarian in your views. When everyone in the room is thinking one thing, the opposite of that thought should be more attractive to you.
“Behind every stock is a company. Find out what it’s doing.” – Peter Lynch
When you look at investments, it is easy to see a collection of numbers and symbols. It’s the same way that you look at a poker table and see clay chips instead of dollar bills. You are supposed to think that you are betting on a stock, when in reality, you are purchasing a company. If you wouldn’t hand over a large stack of cold, hard cash to an owner of that company to purchase part of it, then you shouldn’t consider buying a stock. The same goes for mutual funds and index funds. Understand what the business or businesses behind the stock symbol and make sure that those are businesses that you trust with your hard earned dollars before you consider handing those over.
“Value investing is at its core the marriage of a contrarian streak and a calculator.” – Seth Klarman
Be smart and be different. Don’t be afraid to understand the financials, do the math and make informed decisions. The reason that those decisions seem different than the general public is that the general public doesn’t like to do math.
“How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case.” – Robert G. Allen
Get in the game. If you don’t have the time, knowledge or desire to invest in individual stocks, then do your research and find some solid index funds to trust with your money. But find a way to keep up with the market, because “the market” is going to continue to laugh at the 1% that your dollars are pulling in while they sit in your savings account.
“Know what you own, and know why you own it.” – Peter Lynch
If you had a friend come up to you and say that they had a business idea that was going to make you money and they needed you to invest, I would hope that you would at least understand what their business idea was. Same goes for stocks. If you hear from your rich uncle that XYZG is the hot stock of the summer, figure out what exactly it is and how it fits with your personal investing strategy before you start throwing your cash around.
“The four most dangerous words in investing are: ‘this time it’s different.” – Sir John Templeton
You can’t claim ignorance or a lack of data when it comes to predicting investing trends. Everything that will happen has happened before. There will be another boom. There will be another financial crisis. Learn from history and understand the trends. Otherwise, you will be the one scratching your head and wondering why the same thing has happened yet again.
“If you are not willing to own a stock for 10 years, do not even think about owning it for 10 minutes.” – Warren Buffett
The true stealthy and wealthy investor does not think strictly for the short term. Yes, if you are investing, you will have some great weeks where your net worth sees a dramatic spike. But you will also have weeks where you are tempted to sell everything and cut your losses. Think for the long term, invest in companies that you trust over time and don’t get scared if a security starts to dip. If you did your research and thought it was a good idea to buy a week ago, then the stock drops by 10%, it should be an even better idea to buy today while it is on sale. If you did not do your research, smack yourself in the forehead and go back to the beginning of this article.
“Our job is to find a few intelligent things to do, not to keep up with every damn thing in the world.” – Charlie Munger
It is easy to get overwhelmed by all of the opportunities that exist for you when you become an investor. The stock market alone has enough information that you could spend the rest of your life consuming only what is out there at this very second. Not to mention the real estate market and other investment vehicles. Decide where you want to become an expert, do your research, stay focused and stick to your guns. It will pay off in the long run.
What are the other best investing quotes that you live by? Share in the comments and let me know your favorites!