Whitney Tilson Quotes

The average investor does significantly worse than a simple index... It's literally because of the way our brains are wired.

The chief problem with the individual investor: He or she typically buys when the market is high and thinks it's going to go up, and sells when the market is low and thinks it's going to go down.

When it comes to investing, you are your own worst enemy.

While neurological studies have tried to identify components responsible for fear and greed, the impact on finance is less clear.

When people discover they are no good at baseball or hockey, they put away their bats and their skates and they take up amateur golf or stamp collecting or gardening. But when people discover they are no good at picking stocks, they are likely to continue to do it anyway.

You have a natural tendency to want an emotionally satisfying tale - and to make investments based on that - despite times when the actual data may be telling you something different.

If owning stocks is a long-term project for you, following their changes constantly is a very, very bad idea. It's the worst possible thing you can do, because people are so sensitive to short-term losses. If you count your money every day, you'll be miserable.

Most of the time common stocks are subject to irrational and excessive price fluctuations in both directions as the consequence of the ingrained tendency of most people to speculate or gamble... to give way to hope, fear and greed.

In a rising market, enough of your bad ideas will pay off so that you'll never learn that you should have fewer ideas.

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

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.

There is no such thing as a value trap. There are investing mistakes.

So many folks in the venture capital business are sheep that just want to follow the herd. They are momentum investors purchasing highly illiquid investments. That is a recipe for disaster.

Numerous academic studies have shown that amateur investors make poor traders - buying stocks for the wrong reasons, holding losers for too long, and acting on whims and emotions.

The lesson of my field, behavioral economics, is that we need to understand the ways in which we differ from the rational human assumed in standard economic theory.

Individual investors beware: If you're constantly worried about a crash, you're probably making some big mistakes - and losing a lot of money in the process.

Don't get trapped by looking at what the price was that you paid for some stock originally.

Investing is not nearly as difficult as it looks. Successful investing involves doing a few things right and avoiding serious mistakes.

Humans are hard-wired to be irrational when it comes to financial decisions. We must understand that so we don't become the sucker at the poker table.

Never put your savings in risky investments. Only disposable income should find its way there.

It's human nature: for most investors, the pain of stocks going down is more tangible than the joy of when they go up. The common impulse is to do something - anything - to minimise the pain.

Regardless of what happens in the markets, stick to your investment program. Changing your strategy at the wrong time can be the single most devastating mistake you can make as an investor.

All the things that make us human make us terrible investors and you have to understand what they are and how to avoid them.

The biggest mistake investors make is to believe that what happened in the recent past is likely to persist. They assume that something that was a good investment in the recent past is still a good investment. Typically, high past returns simply imply that an asset has become more expensive and is a poorer, not better, investment.

There is almost no limit to the ability of investors to ignore the lessons of the past.