Richard Thaler Quotes

My advice to the average investor in 1988 is to be patient and think long-term. It will take 18 months for confidence to get better and, in the meantime, this is absolutely no place for short-term money.

You could lose hundreds or thousands one day on paper and gain it all back the next, and it has literally no effect on your immediate future, provided the money you have in the market is money you're investing for the long haul (meaning at least three to five years).

Mutual funds give people the sense that they're investing with the big boys and that they're really not at a disadvantage entering the stock market.

It is important for investors to understand what they do and don't know. Learn to recognize that you cannot possibly know what is going to happen in the future, and any investment plan that is dependent on accurately forecasting where markets will be next year is doomed to failure.

I had a few stocks, but stocks took a dive. I never sell my stocks.

If you are not making any mistakes, you are being excessively risk-averse. Investing involves risk, and that means you will occasionally be wrong. And although it is okay to be wrong, it is not okay to stay wrong.

Well, there's always risk in long-term investment.

Unfortunately, slow and steady in any financial market is actually impossible.

Always keep your portfolio and your risk at your own individual comfortable sleeping point.

I had some airline stock, but the airlines tanked. I didn't have a lot of money in them, though.

Every portfolio benefits from bonds; they provide a cushion when the stock market hits a rough patch. But avoiding stocks completely could mean your investment won't grow any faster than the rate of inflation.

There's a tendency to look at investments in isolation. Investors focus on the risk of individual securities.

I'm not a money manager, but I can tell you what the conventional wisdom is. The younger you are, the more risk you can take on.

Never, ever invest money that you will need prior to three to five years - minimum.

The real key to making money in stocks is not to get scared out of them.

What I'm trying to say is that for the average investor, what I would encourage them to do is to understand that there's inflation and growth. It can go higher and lower and to have four different portfolios essentially that make up your entire portfolio that gets you balanced.

Owning a variety of asset classes means that some part of your portfolio will be doing well when the cyclical turmoil arises. A broadly diversified portfolio includes large capitalization stocks, small cap, emerging markets, fixed income, real estate and commodities.

I'm a very passive investor.

But in practice, if often comes down to not suffering a loss as big as the huge gain you made a while ago.

The last thing you want to do, unless it's a very unusual situation, is to invest money.

The beauty of diversification is it's about as close as you can get to a free lunch in investing.

You'll get nowhere buying stocks just because they have a great story.

Investing is a business where you can look very silly for a long period of time before you are proven right.

I was a stock broker once. I think there is an absolute place for market investments. But they should never be the basis of one's retirement. They should be an additional piece on top of a basic, secure, guaranteed retirement benefit.

Many follow a rule of thumb - no more than 5% in one stock. But that's not the entrepreneurial road to riches.