Quotes by Warren Buffett and other legendary investors
(1) “A climate of fear is your friend when investing; a euphoric world is your enemy.” – Warren Buffett (2013 letter to Berkshire Hathaway shareholders)
(2) “A bull market is like sex. It feels best just before it ends.” – Barton Biggs. (Note: Warren Buffett, in his 2013 letter to Berkshire Hathaway shareholders, was quoting the late Barton Biggs.)
P/S Barton Biggs (November 26, 1932 – July 14, 2012) was a money manager said to be best known for accurately predicting the dot-com bubble in the late 1990s.
(3) “Be fearful when others are greedy, and be greedy when others are fearful.” – Warren Buffett (2006 letter to Berkshire Hathaway shareholders)
(4) “Fear is the foe of the faddist, but the friend of the fundamentalist.” – Warren Buffett (letter to Berkshire Hathaway shareholders in FY1994).
(5) “A truly great business must have an enduring ‘moat’ that protects excellent returns on invested capital.” – Warren Buffett (letter to Berkshire Hathaway shareholders in FY2007)
(6) “You only learn who has been swimming naked when the tide goes out…” – Warren Buffett (letter to Berkshire Hathaway shareholders in FY2007)
P/S Full quote: “As house prices fall, a huge amount of financial folly is being exposed. You only learn who has been swimming naked when the tide goes out – and what we are witnessing at some of our largest financial institutions is an ugly sight.”
(7) “Now, as in 1776, 1861, 1932 and 1941, America’s best days lie ahead.” – Warren Buffett (letter to Berkshire Hathaway shareholders in FY2010). P/S This was a response to the prophets of doom.
(8) “Berkshire is always a buyer of both businesses and securities, and the disarray in markets gave us a tailwind in our purchases. When investing, pessimism is your friend, euphoria the enemy.” – Warren Buffett (letter to Berkshire Hathaway shareholders in FY2008).
(9) “Long ago, Ben Graham taught me that “Price is what you pay; value is what you get.” Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.” – Warren Buffett (letter to Berkshire Hathaway shareholders in FY2008)
(10) “Though the path has not been smooth, our economic system has worked extraordinarily well over time. It has unleashed human potential as no other system has, and it will continue to do so. America’s best days lie ahead.” – Warren Buffett (letter to Berkshire Hathaway shareholders in FY2008)
(11) “Buying a retailer without good management is like buying the Eiffel Tower without an elevator.” – Warren Buffett in his letter to Berkshire Hathaway shareholders (March 1, 1996) for Year 1995
(12) “As they say in poker, “If you’ve been in the game 30 minutes and you don’t know who the patsy is, you’re the patsy.” – Warren Buffett in his letter (dated February 29, 1988 for FY1987) to Berkshire Hathaway shareholders. This quote is a gem on investment wisdom. Mr Warren Buffett was explaining the characteristics of Mr Market, the character used by his teacher and friend Benjamin Graham to explain the market’s irrational behavior. Mr Market is the character with uncontrollable emotional problems.
(13) “In my opinion, investment success will not be produced by arcane formulae, computer programs or signals flashed by the price behavior of stocks and markets. Rather an investor will succeed by coupling good business judgment with an ability to insulate his thoughts and behavior from the super-contagious emotions that swirl about the marketplace.” – Warren Buffett in his letter (dated February 29, 1988 for FY1987) to Berkshire Hathaway shareholders.
(14) “In the short run, the market is a voting machine but in the long run it is a weighing machine.” – Benjamin Graham . The quote was cited by Warren Buffett in his letter (dated 29 February 1988 for FY1987) to Berkshire Hathaway shareholders.
(15) “Intelligent investing is not complex, though that is far from saying that it is easy. What an investor needs is the ability to correctly evaluate selected businesses.” – Note: Quotes 15 – 19 are thoughts on intelligent investing from Warren Buffett in his letter (dated Feb 28, 1997 for FY1996) to Berkshire Hathaway shareholders.
(16) “To invest successfully, you need not understand beta, efficient markets, modern portfolio theory, option pricing or emerging markets. You may, in fact, be better off knowing nothing of these.” – Note: Quotes 15 – 19 are thoughts on intelligent investing from Warren Buffett in his letter (dated Feb 28, 1997 for FY1996) to Berkshire Hathaway shareholders.
(17) “…investment students need only two well-taught courses – How to Value a Business, and How to Think About Market Prices.” – Note: Quotes 15 – 19 are thoughts on intelligent investing from Warren Buffett in his letter (dated Feb 28, 1997 for FY1996) to Berkshire Hathaway shareholders.
(18) “Your goal as an investor should simply be to purchase, at a rational price, a part interest in an easily-understandable business whose earnings are virtually certain to be materially higher five, ten and twenty years from now.” – Note: Quotes 15 – 19 are thoughts on intelligent investing from Warren Buffett in his letter (dated Feb 28, 1997 for FY1996) to Berkshire Hathaway shareholders.
(19) “…If you aren’t willing to own a stock for ten years, don’t even think about owning it for ten minutes.” – Note: Quotes 15 – 19 are thoughts on intelligent investing from Warren Buffett in his letter (dated Feb 28, 1997 for FY1996) to Berkshire Hathaway shareholders.
(20) “Nor do we think many others can achieve long-term investment success by flitting from flower to flower. Indeed, 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.” – Warren Buffett in his letter dated February 28, 1992 for FY1991 to Berkshire Hathaway shareholders. Mr Buffett was talking about Berkshire Hathaway’s Rip Van Winkle approach to investing in common marketable securities.
(21) “You don’t try and buy businesses worth $83 million for $80 million. You leave yourself an enormous margin (of safety). When you build a bridge, you insist it can carry 30,000 pounds, but you only drive 10,000-pound trucks across it. And that same principle works in investing. ” – Warren Buffett on what Benjamin Graham, the father of value investing, meant by having a margin of safety.
Source: The Superinvestors of Graham-and-Doddsville by Warren E. Buffett (1984)
(22) “An investment operation is one which, upon thorough analysis promises safety of principal and an adequate return. Operations not meeting these requirements are speculative.”
Source: Benjamin Graham, “The Intelligent Investor”
(23) “The less the prudence with which others conduct their affairs, the greater the prudence with which we must conduct our own.” – Warren Buffett in his letter dated February 24, 2018, to Berkshire Hathaway shareholders for FY2017. In his comments on the acquisition scene, Warren Buffett commented that “price seemed almost irrelevant to an army of optimistic purchasers”. The full quote is: “Despite our recent drought of acquisitions, Charlie (Munger) and I believe that from time to time Berkshire will have opportunities to make very large purchases. In the meantime, we will stick with our simple guideline: The less the prudence with which others conduct their affairs, the greater the prudence with which we must conduct our own.” Charlie Munger, who died in 2023, was the vice-chairman of Berkshire Hathaway.
(24) “When someone with experience proposes a deal to someone with money, too often the fellow with money ends up with the experience, and the fellow with experience ends up with the money.”
– Chairman Warren Buffett (in his annual letter dated February 28, 2007, to Berkshire Hathaway shareholders).
NB: Warren Buffett used this old adage when he was commenting about how, in 2006, “promises and fees hit new highs”. He was talking about those fund managers that he called “hyper-helpers”.
(25) “To invest successfully over a lifetime does not require a stratospheric IQ, unusual business insights, or inside information. What is needed is a sound intellectual framework for making decisions and the ability to keep emotions from corroding that framework.” – Warren Buffett, chairman of Berkshire Hathaway, said this in the preface of the fourth edition of The Intelligentt Investor, a book by Benjamin Graham, the father of vlaue investing.
(26) Walter Lippmann spoke of men who plant trees that other men will sit under. Ben Graham was such a man. – Warren Buffett in the preface to the fourth edition of The Intelligent Investor by value investing founder Benjamin Graham (1894-1976). Wikipedia says Walter Lippmann (September 23, 1889 – December 14, 1974)[1] was an American writer, reporter, and political commentator.
(27) Remember the work of compounding. For example, if you can make 12% a year and reinvest the money back, you will double your money in six years, taxes excluded. Remember the rule of 72. Your rate of return into 72 will tell you the number of years to double your money. – Walter Jerome Schloss (August 28, 1916 – February 19, 2012) was a notable American value investor who was one of the famous disciples of Benjamin Graham, the founding father of value investor.
(28) “It’s better to have a partial interest in the Hope Diamond than to own all of a rhinestone.” – Warren Buffett, in his F2015 letter to shareholders. The full sentence from Warren Buffett was: “At Berkshire, we much prefer owning a non-controlling but substantial portion of a wonderful company to owning 100% of a so-so business. It’s better to have a partial interest in the Hope Diamond than to own all of a rhinestone.”
(29) “No statement is more true and better applicable to Wall Street than the famous warning of Santayana: ‘Those who do not remember the past are condemned to repeat it.'” – Benjamin Graham, in the introduction of his book, The Intelligent Investor. George Santayana (16 December 1863 to 26 September 1952) was a Spanish American academic, philosopher, essayist, poet and novelist, according to Wikipedia.
(30) “Investment is most intelligent when it is most businesslike.” – Bejamin Graham, The Intelligent Investor.
(31) Though the stock market is massively larger than it was in our early years, today’s active participants are neither more emotionally stable nor better taught than when I was in school. – Warren Buffett in his FY2023 letter to shareholders dated February 24, 2024.
(32) For whatever reasons, markets now exhibit far more casino-like behavior than they did when I was young. The casino now resides in many homes and daily tempts the occupants. – Warren Buffett in his FY2023 letter to shareholders dated February 24, 2024.
(33) “Capitalism has two sides: The system creates an ever-growing pile of losers while concurrently
delivering a gusher of improved goods and services. Schumpeter called this phenomenon “creative
destruction.”” – Warren Buffett in his FY2022 letter to Berkshire Hathaway shareholders dated February 25, 2023.
From Wikipedia: “Creative destruction (German: schöpferische Zerstörung) is a concept in economics that describes a process in which new innovations replace and make obsolete older innovations.
“The concept is usually identified with the Austrian economist Joseph Schumpeter, who derived it from the work of Karl Marx and popularized it as a theory of economic innovation and the business cycle. It is also sometimes known as Schumpeter’s gale. In Marxian economic theory, the concept refers more broadly to the linked processes of the accumulation and annihilation of wealth under capitalism.”
(34) “It’s crucial to understand that stocks often trade at truly foolish prices, both high and low. “Efficient” markets exist only in textbooks. In truth, marketable stocks and bonds are baffling, their behavior usually understandable only in retrospect.” – Warren Buffett in his FY2022 letter to Berkshire Hathaway shareholders dated February 25, 2023.
(35) “Ships will sail around the world but the Flat Earth Society will flourish.” – Warren Buffett
Source: The Superinvestors of Graham-and-Doddsville by Warren E. Buffett (1984)