10 Amazing Investment Quotes You've Probably Never Heard

There are an uncountable number of articles promising "the best investment quotes of all time," or some variation. Most are good reads; but they've become predictable. You know exactly what they're going to contain: Buffett's line about being fearful when others are greedy, Peter Lynch's deal about buying what you know, and a few classic Ben Graham hits. Same quotes again and again.

So, a while back, I did some digging and found 10 great investing quotes that aren't as popular. Enjoy. 

"Risk is what's left over when you think you've thought of everything." -- Carl Richards

Financial advisors say you should have six months of expenses saved as an emergency fund. That's planning. The average duration of unemployment today is 10 months. That's risk.

"In investing, what is comfortable is rarely profitable." -- Robert Arnott

Think about this: Three years after the book Dow 36,000 was published, stocks were down 40%. Three years after The Great Depression Ahead  was published, stocks had doubled.

"When a possibility is unfamiliar to us, we do not even think about it." -- Nate Silver

The two biggest financial stories of the last 12 years were 9/11, and the financial crisis. Be honest with yourself: How often did you think about the possibility of these two things happening before they actually happened? If you're like 99.9% of people, the answer is never.

"People focus on role models; it is more effective to find antimodels -- people you don't want to resemble when you grow up." -- Nassim Taleb

You want to study the greats -- great investors like Buffett and Lynch, and great companies like Apple (NASDAQ: AAPL  ) and Costco (NASDAQ: COST  ) . But you also want to study the failures. Kodak. General Motors (NYSE: GM  ) . Enron. Long-term Capital Management. Lehman Brothers. You'll probably learn more from the failures than you will from the greats.

"Pundits forecast not because they know, but because they are asked." -- John Kenneth Galbraith

There's zero accountability of financial pundits. In fact, the most popular media faces are almost never right, as websites like PunditTracker.com are showing. Keep that in mind when sifting through financial news.

"Being slow and steady means that you're willing to exchange the opportunity of making a killing for the assurance of never getting killed." -- Carl Richards

I recently interviewed value investor Mohnish Pabrai, who had dinner a few years ago with Buffett. Pabrai asked Buffett what happened to a former business partner he used to pick stocks with. (I don't want to name him because he's still in business today.) Buffett said they went their separate ways because the former partner was too eager to get rich, which meant leverage and, eventually, margin calls. Meanwhile, Buffett and partner Charlie Munger "always knew they were going to be rich and were in no hurry." Look who came out ahead.

"If you look carefully, almost all Old Money secrets can be traced to a single source: a longer-term outlook." -- Bill Bonner

It's well known that markets have become more short term. So what? No one said you have to become short term. My colleague Jeremy Phillips calls this "time arbitrage," or "the concept of buying a stock from those with a different time horizon, and selling on our own terms."

"No one can foresee the consequences of trivia and accident, and for that reason alone, the future will forever be filled with surprises." -- Dan Gardner

Speaks for itself. Some of the best investors have succeeded not because they've predicted the future, but because they've dealt with surprises better than most. That usually means having more cash and less debt than seems reasonable.

"The stock market is a giant distraction to the business of investing." -- John Bogle

Motley Fool advisor Ron Gross says we should think of the market as a company market, not a stock market. Here's a good example: On May 10, 2010, the Dow Jones (DJINDICES: ^DJI  )  briefly fell almost 1,000 points, as high-frequency traders tripped over themselves. But it's safe to say that not a single non-financial business in the world was affected in any measureable way. That's the difference between a company market and a stock market. 

"In the corporate world, if you have analysts, due diligence, and no horse sense, you've just described hell." -- Charlie Munger

Really smart people with Ph.D.s used sophisticated math models to conclude that mortgage lending was sound in 2005. They failed miserably. Country bumpkins who didn't know what a balance sheet was said, "Hey, my brother is broke and just got a $500,000 mortgage. That ain't right." They won. 


Read/Post Comments (14) | Recommend This Article (92)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 13, 2012, at 10:08 PM, TENOFWANDS wrote:

    Formulas are written in dust-covered books and on tombstones. There is no ally like that of open-minded attention.

  • Report this Comment On December 13, 2012, at 10:38 PM, aliattitude wrote:

    I agree. Awareness is everything.

  • Report this Comment On December 14, 2012, at 6:16 PM, bjohn17600 wrote:

    The best way to avoid risk is to never pay too much for an investment.

    Bjohn17600

  • Report this Comment On December 15, 2012, at 11:32 AM, richie54 wrote:

    Or pay for an investment advisor.

  • Report this Comment On December 17, 2012, at 10:58 AM, Mathman6577 wrote:

    I think a few people foresaw the housing bubble as a get rich quick scheme bound for failure but they were ignored by the mainstream pundits and gurus.

  • Report this Comment On December 17, 2012, at 11:35 AM, jsn1080 wrote:

    @Morgan Housel - can you cite your sources for these quotes?

    Perhaps the articles, books, and/or conversations from which these quotes are derived have additional words of wisdom that we can all benefit from. Thanks.

  • Report this Comment On December 17, 2012, at 3:49 PM, Darwood11 wrote:

    "In investing, what is comfortable is rarely profitable."

    I knew people who thought "if the DOW will hit 36,000 then there is little risk for me to enter here with the DOW at 14,164?"

    Yes, a lack of critical thinking skills is dangerous to one's health. That, and listening to any politician.

  • Report this Comment On December 18, 2012, at 11:54 AM, SkepikI wrote:

    Ahh, Morgan, back on track with another amusing, thought provoking and accurate article.... My favorite which I can never recall the source on came from a long time associate of Cornelius Vanderbilt at Vanderbilt's memorial service, when asked "how much did he leave?" replied "I believe he left it all"

    I also like Charlie Munger's little noted remark to the effect- Something that shouldn't be done at all, shouldn't be done better (sorry no quotes because I don't want to mangle his exact words)

    Those serve to remind me there is a purpose in investing (as opposed to gambling) and its not mere accumulation.

  • Report this Comment On December 18, 2012, at 3:12 PM, catoismymotor wrote:

    Morgan,

    Thanks for this article. I found it to be so infteresting that I researched the source of one of the quotes. And that lead me to a book I asked Santa to leave under the tree.

    - Cato

  • Report this Comment On December 18, 2012, at 3:23 PM, TMFMorgan wrote:

    ^ Great! A few books from where some of these quotes came from:

    The Bed of Procrustes (Taleb)

    The Behavior Gap (Richards)

    Family Fortunes (Bonner)

    Signal and Noise (Silver)

    Future Babble (Gardner)

  • Report this Comment On December 18, 2012, at 7:49 PM, barbiee01 wrote:

    I am just curious. Why must one always supply an email address to get the information from one of your articles? Why can't you just say what you want to say to those reading your articles? It is a pain to have to sign up for all of the information everytime I punch on your site.

  • Report this Comment On December 21, 2012, at 4:42 PM, drborst wrote:

    Morgan,

    Nice list. I don't want to be too critical, but I'm not sure I really sure about three of them.

    First, I don't get the relationship between comfortable and profitable in the Robert Arnot quote. I'm pretty sure Buffett and Munger are pretty comfortable with their investments. And after reading you for years, I know better than to find comfort in a confirmation bias based book like 'Dow 36,000'

    Second, I know everybody wants a Nate Silver quote these days, but come on, there has to be something better than a tautology. That I don't think of things I'm unfamiliar with seems less insightful than the mocked Donald Rumsfeld quote about known unknowns and unknown unknowns.

    And finally, while I love the Boner quote about Old Money, I tend to think of Old Money as Inherited, and I'm not sure I want to spend my best years patiently preparing to be a rich 80 year old, (and then Skepicl killed it for me with the Vanderbilt quote about leaving it all).

    DRB

  • Report this Comment On December 22, 2012, at 1:16 PM, whyaduck1128 wrote:

    When a possibility is unfamiliar to us, we do not even think about it.

    --------------------------------------

    No offense intended to the estimable Mr. Silver, but this quote is nonsense. It ranks right down there with this one from one of my local baseball announcers from this past season--

    "When you're standing still, you have no momentum."

  • Report this Comment On February 10, 2013, at 3:12 PM, 1sweet1 wrote:

    I loved the article. Marsha

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