Top 20 Quotes from Warren Buffett

Wise Words From Warren Buffett

Warren Buffett Quotes on Life

Top 20 Quotes from Warren Buffett

Only when the tide goes out, do you discover who's been swimming naked

Honesty is a very Expensive Gift. Do not expect it from Cheap People.

Excellent Quotes by Warren Buffett

10 Amazing Investment Quotes You've Probably Never Heard

By Morgan Housel
December 13, 2012

There are an uncountable number of articles promising "the best investment quotes of all time," or some variation. Most are good reads; but they've become predictable. You know exactly what they're going to contain: Buffett's line about being fearful when others are greedy, Peter Lynch's deal about buying what you know, and a few classic Ben Graham hits. Same quotes again and again.

So, a while back, I did some digging and found 10 great investing quotes that aren't as popular. Enjoy. 

"Risk is what's left over when you think you've thought of everything." -- Carl Richards

Financial advisors say you should have six months of expenses saved as an emergency fund. That's planning. The average duration of unemployment today is 10 months. That's risk.

"In investing, what is comfortable is rarely profitable." -- Robert Arnott

Think about this: Three years after the book Dow 36,000 was published, stocks were down 40%. Three years after The Great Depression Ahead  was published, stocks had doubled.

"When a possibility is unfamiliar to us, we do not even think about it." -- Nate Silver

The two biggest financial stories of the last 12 years were 9/11, and the financial crisis. Be honest with yourself: How often did you think about the possibility of these two things happening before they actually happened? If you're like 99.9% of people, the answer is never.

"People focus on role models; it is more effective to find antimodels -- people you don't want to resemble when you grow up." -- Nassim Taleb

You want to study the greats -- great investors like Buffett and Lynch, and great companies like Apple (NASDAQ: AAPL  ) and Costco (NASDAQ: COST  ) . But you also want to study the failures. Kodak. General Motors (NYSE: GM  ) . Enron. Long-term Capital Management. Lehman Brothers. You'll probably learn more from the failures than you will from the greats.

"Pundits forecast not because they know, but because they are asked." -- John Kenneth Galbraith

There's zero accountability of financial pundits. In fact, the most popular media faces are almost never right, as websites like PunditTracker.com are showing. Keep that in mind when sifting through financial news.

"Being slow and steady means that you're willing to exchange the opportunity of making a killing for the assurance of never getting killed." -- Carl Richards

I recently interviewed value investor Mohnish Pabrai, who had dinner a few years ago with Buffett. Pabrai asked Buffett what happened to a former business partner he used to pick stocks with. (I don't want to name him because he's still in business today.) Buffett said they went their separate ways because the former partner was too eager to get rich, which meant leverage and, eventually, margin calls. Meanwhile, Buffett and partner Charlie Munger "always knew they were going to be rich and were in no hurry." Look who came out ahead.

"If you look carefully, almost all Old Money secrets can be traced to a single source: a longer-term outlook." -- Bill Bonner

It's well known that markets have become more short term. So what? No one said you have to become short term. My colleague Jeremy Phillips calls this "time arbitrage," or "the concept of buying a stock from those with a different time horizon, and selling on our own terms."

"No one can foresee the consequences of trivia and accident, and for that reason alone, the future will forever be filled with surprises." -- Dan Gardner

Speaks for itself. Some of the best investors have succeeded not because they've predicted the future, but because they've dealt with surprises better than most. That usually means having more cash and less debt than seems reasonable.

"The stock market is a giant distraction to the business of investing." -- John Bogle

Motley Fool advisor Ron Gross says we should think of the market as a company market, not a stock market. Here's a good example: On May 10, 2010, the Dow Jones (DJINDICES:^DJI  )  briefly fell almost 1,000 points, as high-frequency traders tripped over themselves. But it's safe to say that not a single non-financial business in the world was affected in any measureable way. That's the difference between a company market and a stock market. 

"In the corporate world, if you have analysts, due diligence, and no horse sense, you've just described hell." -- Charlie Munger

Really smart people with Ph.D.s used sophisticated math models to conclude that mortgage lending was sound in 2005. They failed miserably. Country bumpkins who didn't know what a balance sheet was said, "Hey, my brother is broke and just got a $500,000 mortgage. That ain't right." They won. 

http://www.fool.com/investing/general/2012/12/13/10-amazing-investment-quotes-youve-probably-never.aspx?source=ihpdspmra0000001&lidx=3

50 Unfortunate Truths About Investing

Sorry, but ... 

1. Saying "I'll be greedy when others are fearful" is much easier than actually doing it.

2. The gulf between a great company and a great investment can be extraordinary.

3. Markets go through at least one big pullback every year, and one massive one every decade. Get used to it. It's just what they do.

4. There is virtually no accountability in the financial pundit arena. People who have been wrong about everything for years still draw crowds.

5. As Erik Falkenstein says: "In expert tennis, 80% of the points are won, while in amateur tennis, 80% are lost. The same is true for wrestling, chess, and investing: Beginners should focus on avoiding mistakes, experts on making great moves."

6. There are tens of thousands of professional money managers. Statistically, a handful of them have been successful by pure chance. Which ones? I don't know, but I bet a few are famous.

7. On that note, some investors who we call "legendary" have barely, if at all, beaten an index fund over their careers. On Wall Street, big wealth isn't indicative of big returns. 

8. During recessions, elections, and Federal Reserve policy meetings, people become unshakably certain about things they know nothing about.

9. The more comfortable an investment feels, the more likely you are to be slaughtered.

10. Time-saving tip: Instead of trading penny stocks, just light your money on fire. Same for leveraged ETFs.

11. Not a single person in the world knows what the market will do in the short run. End of story.

12. The analyst who talks about his mistakes is the guy you want to listen to. Avoid the guy who doesn't -- his are much bigger.

13. You don't understand a big bank's balance sheet. The people running the place and their accountants don't, either.

14. There will be seven to 10 recessions over the next 50 years. Don't act surprised when they come.

15. Thirty years ago, there was one hour of market TV per day. Today there's upwards of 18 hours. What changed isn't the volume of news, but the volume of drivel. 

16. Warren Buffett's best returns were achieved when markets were much less competitive. It's doubtful anyone will ever match his 50-year record.

17. Most of what is taught about investing in school is theoretical nonsense. There are very few rich professors.

18. The more someone is on TV, the less likely his or her predictions are to come true. (U.C. Berkeley psychologist Phil Tetlock has data on this).

19. Related: Trust no one who is on CNBC more than twice a week.

20. The market doesn't care how much you paid for a stock. Or your house. Or what you think is a "fair" price.

21. The majority of market news is not only useless, but also harmful to your financial health.

22. Professional investors have better information and faster computers than you do. You will never beat them short-term trading. Don't even try. 

23. How much experience a money manager has doesn't tell you much. You can underperform the market for an entire career. And many have.

24. The decline of trading costs is one of the worst things to happen to investors, as it made frequent trading possible. High transaction costs used to cause people to think hard before they acted.

25. Professional investing is one of the hardest careers to succeed at, but it has lowbarriers to entry and requires no credentials. That creates legions of "experts" who have no idea what they are doing. People forget this because it doesn't apply to many other fields.

26. Most IPOs will burn you. People with more information than you have want to sell. Think about that.

27. When someone mentions charts, moving averages, head-and-shoulders patterns, or resistance levels, walk away.

28. The phrase "double-dip recession" was mentioned 10.8 million times in 2010 and 2011, according to Google. It never came. There were virtually no mentions of "financial collapse" in 2006 and 2007. It did come.

29. The real interest rate on 20-year Treasuries is negative, and investors are plowing money into them. Fear can be a much stronger force than arithmetic.

30. The book Where Are the Customers' Yachts? was written in 1940, and most still haven't figured out that financial advisors don't have their best interest at heart.

31. The low-cost index fund is one of the most useful financial inventions in history. Boring but beautiful. 

32. The best investors in the world have more of an edge in psychology than in finance.

33. What markets do day to day is overwhelmingly driven by random chance. Ascribing explanations to short-term moves is like trying to explain lottery numbers.

34. For most, finding ways to save more money is more important than finding great investments.

35. If you have credit card debt and are thinking about investing in anything, stop. You will never beat 30% annual interest. 

36. A large portion of share buybacks are just offsetting shares issued to management as compensation. Managers still tout the buybacks as "returning money to shareholders."

37. The odds that at least one well-known company is insolvent and hiding behind fraudulent accounting are high.

38. Twenty years from now the S&P 500 (INDEX: ^GSPC  ) will look nothing like it does today. Companies die and new ones emerge.

39. Twelve years ago General Motors (NYSE: GM  ) was on top of the world and Apple(Nasdaq: AAPL  ) was laughed at. A similar shift will occur over the next decade, but no one knows to what companies.

40. Most would be better off if they stopped obsessing about Congress, the Federal Reserve, and the president and focused on their own financial mismanagement. 

41. For many, a house is a large liability masquerading as a safe asset.

42. The president has much less influence over the economy than people think.

43. However much money you think you'll need for retirement, double it. Now you're closer to reality.

44. The next recession is never like the last one. 

45. Remember what Buffett says about progress: "First come the innovators, then come the imitators, then come the idiots."

46. And what Mark Twain says about truth: "A lie can travel halfway around the world while truth is putting on its shoes."

47. And what Marty Whitman says about information: "Rarely do more than three or four variables really count. Everything else is noise."

48. The bigger a merger is, the higher the odds it will be a flop. CEOs love empire-building by overpaying for companies.

49. Investments that offer little upside and big downside outnumber those with the opposite characteristics at least 10-to-1.

50. The most boring companies -- toothpaste, food, bolts -- can make some of the bestlong-term investments. The most innovative, some of the worst.

50 Unfortunate Truths About Investing

By Morgan Housel
November 14, 2012
http://www.fool.com/investing/general/2012/11/14/50-unfortunate-truths-about-investing.aspx

Warren Buffett quotes

Warren Buffett Quotes

• You are neither right nor wrong because the crowd disagrees with you. You are right because your data and reasoning are right.
• We do not view the company itself as the ultimate owner of our business assets but instead view the company as a conduit through which our shareholders own assets.
• When Berkshire buys common stock, we approach the transaction as if we were buying into a private business.
• Wide diversification is only required when investors do not understand what they are doing.
• Accounting consequences do not influence our operating or capital-allocation decisions. When acquisition costs are similar, we much prefer to purchase $2 of earnings that is not reportable by us under standard accounting principles than to purchase $1 of earnings that is reportable.
• Never invest in a business you cannot understand.
• Unless you can watch your stock holding decline by 50% without becoming panic-stricken, you should not be in the stock market.
• Why not invest your assets in the companies you really like? As Mae West said, "Too much of a good thing can be wonderful".
• (When speaking of managers and executive compensation) The .350 hitter expects, and also deserves, a big payoff for his performance - even if he plays for a cellar-dwelling team. And a .150 hitter should get no reward - even if he plays for a pennant winner.
• The critical investment factor is determining the intrinsic value of a business and paying a fair orbargain price.
• Risk can be greatly reduced by concentrating on only a few holdings.
• Stop trying to predict the direction of the stock market, the economy, interest rates, or elections.
• Many stock options in the corporate world have worked in exactly that fashion: they have gained in value simply because management retained earnings, not because it did well with the capital in its hands.
• Buy companies with strong histories of profitability and with a dominant business franchise.
• Be fearful when others are greedy and greedy only when others are fearful.
• It is optimism that is the enemy of the rational buyer.
• As far as you are concerned, the stock market does not exist. Ignore it.
• The ability to say "no" is a tremendous advantage for an investor.
• Much success can be attributed to inactivity. Most investors cannot resist the temptation to constantly buy and sell.
• Lethargy, bordering on sloth should remain the cornerstone of an investment style.
• An investor should act as though he had a lifetime decision card with just twenty punches on it.
• Wild swings in share prices have more to do with the "lemming- like" behaviour of institutional investors than with the aggregate returns of the company they own.
• As a group, lemmings have a rotten image, but no individual lemming has ever received bad press.
• An investor needs to do very few things right as long as he or she avoids big mistakes.
• "Turn-arounds" seldom turn.
• Is management rational?
• Is management candid with the shareholders?
• Does management resist the institutional imperative?
• Do not take yearly results too seriously. Instead, focus on four or five-year averages.
• Focus on return on equity, not earnings per share.
• Calculate "owner earnings" to get a true reflection of value.
• Look for companies with high profit margins.
• Growth and value investing are joined at the hip.
• The advice "you never go broke taking a profit" is foolish.
• It is more important to say "no" to an opportunity, than to say "yes".
• Always invest for the long term.
• Does the business have favourable long term prospects?
• It is not necessary to do extraordinary things to get extraordinary results.
• Remember that the stock market is manic-depressive.
• Buy a business, don't rent stocks.
• Does the business have a consistent operating history?
• An investor should ordinarily hold a small piece of an outstanding business with the same tenacity that an owner would exhibit if he owned all of that business.

http://beginnersinvest.about.com/cs/warrenbuffett/a/aawarrenquotes.htm

The Investment Philosophy of Warren Buffett - In 23 Quotes

Warren Buffett is the most successful investor of our time, perhaps of any time. He is famous for his pithy quotes, which often appear in his annual letter to shareholders.

Taken together, his quotes pretty well sum up his investment philosophy and approach. Here are his best sound bites of all time on being a sensible investor.

1. Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.

2. Investing is laying out money now to get more money back in the future.

3. Never invest in a business you cannot understand.

4. I don't look to jump over 7-foot bars: I look around for 1-foot bars that I can step over.

5. I put heavy weight on certainty. It's not risky to buy securities at a fraction of what they're worth.

6. If a business does well, the stock eventually follows.

7. It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.

8. Time is the friend of the wonderful company, the enemy of the mediocre.

9. For some reason people take their cues from price action rather than from values. Price is what you pay. Value is what you get.

10. In the short run, the market is a voting machine. In the long run, it's a weighing machine.

11. The most common cause of low prices is pessimism. We want to do business in such an environment, not because we like pessimism, but because we like the prices it produces. It's optimism that is the enemy of the rational buyer. None of this means, however, that a business or stock is an intelligent purchase simply because it is unpopular; a contrarian approach is just as foolish as a follow-the-crowd strategy. What's required is thinking rather than polling.

12. Risk comes from not knowing what you're doing.

13. It is better to be approximately right than precisely wrong.

14. All there is to investing is picking good stocks at good times and staying with them as long as they remain good companies.

15. Wide diversification is only required when investors do not understand what they are doing.

16. You do things when the opportunities come along. I have had periods in my life when I have had a bundle of ideas come along, and I've had long dry spells. If I get an idea next week, I'll do something. If not, I won't do a damn thing.

17. [On the dot-com bubble:] What we learn from history is that people don't learn from history.

18. You are neither right nor wrong because the crowd disagrees with you. You are right because your data and reasoning are right.

19. You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ.

20. You should invest in a business that even a fool can run, because someday a fool will.

21. When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact.

22. The best business returns are usually achieved by companies that are doing something quite similar today to what they were doing five or ten years ago.

23. Diversification may preserve wealth, but concentration builds wealth.

Article Source: http://EzineArticles.com/528157

By David Van Knapp

http://ezinearticles.com/?The-Investment-Philosophy-of-Warren-Buffett---In-23-Quotes&id=528157

Stock, Investment, Money, Business Quotes & Sayings

25 Best Warren Buffett Quotes on His Strategies, Investments, and Cheap Suits

25 Best Warren Buffett Quotes on His Strategies, Investments, and Cheap Suits
Posted by Admin in KLSE Talk on 09 16th, 2009

He's called the Oracle of Omaha, and for good reason: not only is he one of the best investors of all time, but hes also a witty communicator.

Here are twenty-five awesome quotes from the man himself. I find these quotes to be especially comforting when youre financially depressed after all, he views a market slump as a good thing!so I hope these can remind everyone that we just need to do the basics, and well be OK. Be a consistent net saver, buy the market through ups and downs, be a decent human being, and rest easy.

On Investing

- Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.
- Its far better to buy a wonderful company at a fair price than a fair company at a wonderful price.
- Only buy something that youd be perfectly happy to hold if the market shut down for 10 years.
- We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.
- Why not invest your assets in the companies you really like? As Mae West said, Too much of a good thing can be wonderful.

On Success

- Of the billionaires I have known, money just brings out the basic traits in them. If they were jerks before they had money, they are simply jerks with a billion dollars.
- The business schools reward difficult complex behavior more than simple behavior, but simple behavior is more effective.
- You do things when the opportunities come along. Ive had periods in my life when Ive had a bundle of ideas come along, and Ive had long dry spells. If I get an idea next week, Ill do something. If not, I wont do a damn thing.
- Can you really explain to a fish what its like to walk on land? One day on land is worth a thousand years of talking about it, and one day running a business has exactly the same kind of value.
- You only have to do a very few things right in your life so long as you dont do too many things wrong.

On Helping Others

- If youre in the luckiest 1 per cent of humanity, you owe it to the rest of humanity to think about the other 99 per cent.
- It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, youll do things differently.
- I dont have a problem with guilt about money. The way I see it is that my money represents an enormous number of claim checks on society. Its like I have these little pieces of paper that I can turn into consumption. If I wanted to, I could hire 10,000 people to do nothing but paint my picture every day for the rest of my life. And the GNP would go up. But the utility of the product would be zilch, and I would be keeping those 10,000 people from doing AIDS research, or teaching, or nursing. I dont do that though. I dont use very many of those claim checks. Theres nothing material I want very much. And Im going to give virtually all of those claim checks to charity when my wife and I die.
- Its class warfare, my class is winning, but they shouldnt be.
- My family wont receive huge amounts of my net worth. That doesnt mean theyll get nothing. My children have already received some money from me and Susie and will receive more. I still believe in the philosophy – FORTUNE quoted me saying this 20 years ago – that a very rich person should leave his kids enough to do anything but not enough to do nothing.

On Life

- Chains of habit are too light to be felt until they are too heavy to be broken.
- We enjoy the process far more than the proceeds.
- You only find out who is swimming naked when the tide goes out.
- Someones sitting in the shade today because someone planted a tree a long time ago.
- A public-opinion poll is no substitute for thought.

Funny Ones

- A girl in a convertible is worth five in the phonebook.
- When they open that envelope, the first instruction is to take my pulse again.
- We believe that according the name investors to institutions that trade actively is like calling someone who repeatedly engages in one-night stands a romantic.
- When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact.
- In the insurance business, there is no statute of limitation on stupidity.


http://klse.talkmalaysia.com/2009/09/25-best-warren-buffett-quotes-on-his-strategies-investments-and-cheap-suits/