Benjamin Graham Quotes
Mathematics is ordinarily considered as producing precise and dependable results; but in the stock market the more elaborate and abstruse the mathematics the more uncertain and speculative are the conclusions we draw there from. Whenever calculus is brought in, or higher algebra, you could take it as a warning that the operator was trying to substitute theory for experience, and usually also to give to speculation the deceptive guise of investment.
Graham, Benjamin. The Intelligent Investor. 4th Rev. ed., Harper & Row, 1973, p. 281.
Economics has never been a precise science which is one of the reasons it is called the “dismal science.” In the final analysis economics depends on the behavior of people—rational and irrational.
He distressed most of the other stock brokers on Wall Street by pointing out that if brokers were so smart, why would they not want to buy the stock for themselves rather than sell it to you. Therefore, he generally concluded that the best stocks are bought by the brokers and bankers for their own accounts, and the lesser quality shares are sold to the public.
Benjamin Graham was a British-born American economist, professor and investor. He is widely known as the "father of value investing", and wrote two of the founding texts in neoclassical investing: Security Analysis (1934) with David Dodd, and The Intelligent Investor (1949). His investment philosophy stressed investor psychology, minimal debt, buy-and-hold investing, fundamental analysis, concentrated diversification, buying within the margin of safety, activist investing, and contrarian mindsets.
