At the moment, there is a whole lot of more or less anonymous investment experts on the Internet. Sometimes, however, it’s worth listening to really big market players, famous traders, politicians, millionaires or billionaires. Both novices and more seasoned investors will find some advice to keep in mind. Here are the fifteen most interesting up-to-date quotes about investing:
- The four most dangerous words in investing are: this time it’s different, John Templeton. Templeton’s words are simple to interpret – making the same mistakes all over again is a result of “wishful thinking”, expecting something to happen, because I WANT it to happen, contrary to the predictions based on past experience.
- In investing, what is comfortable is rarely profitable. – Robert Arnott. In other words, higher risk usually means higher profit – even though thinking about loss can be overwhelming.
- It’s not now much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for. – Robert Kiyosaki. Kiyosaki points out that what counts in the end is not the wealth amassed at some point in life, but how much of that wealth is ultimately left.
- The markets can remain irrational longer than you can remain solvent. – John Maynard Keynes. These are very wise words, which stress that some trends can’t be predicted even with very thorough analysis. So, sometimes loss is not the result of a mistake, but of unpredictability.
- The goal of a successful trader is to make the best trades. Money is secondary. – Alexander Elder. Elder reminds us of the need to be committed to the very process of investing, pointing out that making accurate predictions is already a success itself.
- Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas. – Paul Samuelson. Most investments should be considered on a long-term basis. Fluctuations in the markets can be exciting for beginners, but it soon turns out that in the long run investing can be… uneventful or even boring.
- Speculation is an effort, probably unsuccessful, to turn a little money into a lot. And Investing is an effort, which should be successful, to prevent a lot of money from becoming a little. – Fred Schwed. This is an accurate comparison of the level of risk in the case of speculations and in the case of investing. Unsurprisingly, for people with a lot of capital it is easier when it comes to risk management. But, they can be affected by inflation or prodigality.
- Short-term volatility is greatest at turning points and diminishes as a trend becomes established. – George Soros. It’s one of the basic principles of making decisions based on a trend. When a trend changes, everyone is trying hard to adapt, which triggers great volatility. When the trend stabilizes again, its volatility decreases.
- Many traders ride an emotional roller coaster and miss the essential element of winning: the management of their emotions. – Alexander Elder. An overly emotional approach to investment successes and failures can have a negative impact on the mental condition of every investor, not only disrupting their view of the situation, but also making their life much more difficult.
- Many investors make the mistake of buying high and selling low while the exact opposite is the right strategy to outperform over the long term. – John Paulson. This quote doesn’t need any explanation – it’s about sensing the trend and acting in such a way as to buy cheap and sell dear.
- Time is always, and it will be the most significant aspect of predicting market actions. The one who can study the past data and records of the market can understand how history repeats itself. Then the future can be predicted with the help of the past itself. … There is a clear correlation between TIME and PRICE. … Now, by a study of the TIME PERIODS and TIME CYCLES you will learn why tops and bottoms are found at certain times and why resistance levels are so strong at certain times and bottoms and tops hold around them. … The most money is made when fast moves and extreme fluctuations occur at the end of major cycles. – W.D. Gann. Gann stresses the importance of analysing past trends in order to predict future ones. He also stresses how important strong hunch is for every investor when it comes to the timing of buying and selling.
- If you diversify, control your risk, and go with the trend, it just has to work. – Larry Hite. The three most important principles of playing safe in investing are: diversification, i.e. dividing your capital and investing in different assets, risk management, i.e. knowing how much risk is being taken and when to sell assets or limit losses, and, of course, going with the trend.
- The stock market is designed to transfer money from the active to the patient. – Warren Edward Buffett. Buffett [JO1] criticizes the hot-headedness of investors, stressing that long-term strategies can be a better solution than many short-term investments.
- No one would remember the Good Samaritan if he’d only had good intentions; he had money, too. – Margaret Thatcher. This sentence is a general remark about the value of money in the world.
- Novice traders trade three to five times too big. They are taking 5 to 10 percent risks on a trade when they should be taking 1 to 2 percent risks. – Bruce Kovner. There is no need to explain this quote – beginner traders should carefully consider the risk they are taking.
As you can see, there is an abundance of statements about investing as a process, its meaning and the value of money, as well as specific advice for beginners and seasoned traders. You should learn from those who are better in some respects, especially those who have often made great fortunes thanks to their experience and intuition.
[JO1]Błąd w zapisie nazwy w tekście źródłowym – mamy Buttfett, powinni być Buffett