Trading & Investing Quotes
Below are some well-known trading and investing quotes that encapsulate various aspects of market philosophy, risk management, and trading and investment strategy.
We also have some unique quotes in the section after, which have fun applications to trading and investing contexts.
Trading & Investing Quotes
“[Many] know the price of everything, but the value of nothing.” – Philip Fisher
This quote emphasizes the distinction between price and value.
It highlights the importance of understanding a company’s intrinsic value rather than just its current stock price.
A company’s value can also differ by individual depending on their preferences and requirements.
“In the short run, the market is a voting machine but in the long run, it is a weighing machine.” – Benjamin Graham
Graham’s quote underscores the idea that while market sentiment may drive stock prices in the short term, ultimately, a company’s fundamental value will be reflected in its stock price over the long term.
“Be fearful when others are greedy and greedy when others are fearful.” – Warren Buffett
Buffett’s advice suggests that the best opportunities to buy stocks are when others are selling out of fear, and the best times to sell are when others are buying aggressively out of greed.
“The goal of a successful trader is to make the best trades. Money is secondary.” – Alexander Elder
This quote highlights that focusing on developing and executing a sound trading strategy is more important than the money that might come from trading.
It can also secondarily suggest that prioritizing what you enjoy is most important, as whatever you earn is likely to be a byproduct of that.
“Do not be embarrassed by your failures, learn from them and start again.” – Richard Branson
Although not specifically about trading, Branson’s advice is pertinent, where setbacks and losses are part of the learning process that can lead to greater success.
Markets are full of variance and mistakes are common. Nothing goes in a straight line.
“It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.” – George Soros
Soros points out the importance of risk and money management in trading, and that winning percentage isn’t the most important factor.
Making more on winning trades than you lose on losing trades is key to successful trading and investing.
To use a baseball analogy, slugging percentage is more important than batting average.
Think more in terms of expected value.
For example, if you had a hypothetical strategy where you had a 1% chance of being right and a $1,000 reward for being right, and a 99% chance of being wrong a $1 penalty for being wrong, your expected value is +$9.01 for every iteration.
If assessed accurately, this will work, as long as you can cover the losses or dry spells in the interim.
“The four most dangerous words in investing are: ‘this time it’s different.'” – Sir John Templeton
Templeton’s quote warns against the belief that the fundamental principles of investing can be ignored based on current market conditions.
“Markets can remain irrational longer than you can remain solvent.” – John Maynard Keynes
This quote serves as a caution to traders and investors against taking positions that rely on the market quickly correcting an irrational pricing – i.e., such as notional long-term fundamental or equilibrium value – as markets can stay irrational for unpredictable periods.