Stanley Druckenmiller Quotes

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

There is a close logical connection between the concept of a safety margin and the principle of diversification.

Instead of hoping he must fear and instead of fearing he must hope. He must fear that his loss may develop into a much bigger loss, and hope that his profit may become a big profit.

Should you protect profits? Yes. But run for the hills? No.

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

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

One thing that served me well with clients was that you back your winners and you back your losers.

The things that I've learned is, try to make all the mistakes with your own money and on a small level so that when you are responsible for a partner's money or assets, you've learned, and you don't make bigger mistakes.

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

When you take smaller gambles, no one particular deal can be big enough to have a material adverse effect on the company.

When you see a 'Shark fight' erupt, we aggressively want to understand what we are committing our money toward.

When investing, pessimism is your friend, euphoria the enemy.

An important key to investing is to remember that stocks are not lottery tickets.

You're looking for a mispriced gamble. That's what investing is. And you have to know enough to know whether the gamble is mispriced. That's value investing.

The first rule of trading - there are probably many first rules - is don't get caught in a situation in which you can lose a great deal of money for reasons you don't understand.

Thousands of people have tried, and the evidence is clear: The more you trade, the less you keep.

I'd say it's that most people think that very wealthy people take huge risks and that's why they have huge rewards. But the very best on earth are completely obsessed with not losing money. That sounds overly simplistic, but they know that if you lost 50 percent, it takes 100 percent to get even. Most people don't make that math in their head, so it takes years and years. They are obsessed with not losing money.

Using volatility as a measure of risk is nuts. Risk to us is 1) the risk of permanent loss of capital, or 2) the risk of inadequate return.

And then at the end of the day, the most important thing is how good are you at risk control. Ninety-percent of any great trader is going to be the risk control.

If your broker or investment advisor is not familiar with the concept of standard deviation of returns, get a new one.

What you really want to do in investments is figure out what's important and knowable. If it's unimportant or unknowable you forget about it.

Where you want to be is always in control, never wishing, always trading, and always first and foremost protecting your ass. That's why most people lose money as individual investors or traders because they're not focusing on losing money. They need to focus on the money that they have at risk and how much capital is at risk in any single investment they have. If everyone spent 90 percent of their time on that, not 90 percent of the time on pie-in-the-sky ideas on how much money they're going to make, then they will be incredibly successful investors.

There is a time to make money and a time to not lose money.

You must never delude yourself into thinking that you're investing when you're speculating.