Benjamin Graham: Marketing

“[Shorter variant:] In the short run, the market is a voting machine but in the long run, it is a weighing machine.”

Benjamin Graham

Quoted and attributed to Graham in Warren Buffett's 1993 letter to investors. https://www.berkshirehathaway.com/letters/1993.html
The statement is not found in any of Graham's publications or lecture transcripts, and when asked, Buffett could not provide a reference. https://www.bogleheads.org/forum/viewtopic.php?t=77840
Disputed

“It is worth pointing out that assuredly not more than one person out of a hundred who stayed in the market after after 1925 emerged from it with a net profit and that the speculative losses taken were appalling.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter II, The Investor and Stock-Market Fluctuations, p. 34

Loss , Personality

“Whenever the investor sold out in an upswing as soon as the top level of the previous well-recognized bull market was reached, he had a chance in the next bear market to buy back at one third (or better) below his selling price.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter II, The Investor and Stock-Market Fluctuations, p. 35

Chance

“There is something paradoxical in the fact that by establishing an export market we subject our entire domestic production to the vagaries of that market.”

Benjamin Graham

Part IV, Chapter XIV, Farm Problems and Remedies, p. 172
Storage and Stability (1937)

“Nearly everyone interested in common stocks wants to be told by someone else what he thinks the market is going to do. The demand being there, it must be supplied.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter III, The Investor and His Advisers, p. 48

Thinking

“The history of the past fifty years, and longer, indicates that a diversified holding of representative common stocks will prove more profitable over a stretch of years than a bond portfolio, with one important provisio—that the shares must be purchased at reasonable market levels, that is, levels that are reasonable in the light of fairly well-defined standards derived from past experience.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter I, What the Intelligent Investor Can Accomplish, p. 7

History , Light , Past

“The true investor scarcely ever has to sell his shares, and at all other times he is free di disregard the current price quotation. He need pay attention to it and act upon it only to the extent that it suits his book, and no more. Thus the investor who permits himself to be stampeded or unduly worried by unjustified market declines in his holdings is perversely transforming his basic advantage into a basic disadvantage. That man would be better off if his stocks had no market quotation at all, for he would then be spared the mental anguish caused him by other persons mistakes of judgement.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter II, The Investor and Stock-Market Fluctuations, p. 40

Books , Time , Personality

“The graph does show one tremendous rise and collapse which stands out starkly from all the other fluctuations. This is commonly called the "new era" stock market of 1927-33. The striking feature of this phenomenon was that the new era existed solely in the minds of market speculators. The whole episode, in retrospect, now seems to have been one of those rare manifestations of mass financial madness which we used to study in our history books under the titles of "the South Sea Bubble", "the Mississippi Bubble" and so on.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter II, The Investor and Stock-Market Fluctuations, p. 36

Books , History , Study , Sea

“A price decline is of no real importance to the bona fide investor unless it is either very substantial—say, more than a third from cost—or unless it reflects a known deterioration of consequence in the company's position. In a well-defined bear market many sound common stocks sell temporarily at extraordinary low prices. It is possible that the investor may then have a paper loss of fully 50 per cent on some of his holdings, without any convincing indication that the underlying values have been permanently affected.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter II, The Investor and Stock-Market Fluctuations, p. 25

Loss

“Basically, price fluctuations have only one significant meaning for the true investor. They provide him with an opportunity to buy wisely when prices fall sharply and to sell wisely when they advance a great deal. At other times he will do better if he forgets about the stock market and pays attention to his dividend returns and to the operating results of his companies.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter II, The Investor and Stock-Market Fluctuations, p. 42

Time , Forgetting

“Good managements produce a good average market price, and bad managements produce bad market prices.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter II, The Investor and Stock-Market Fluctuations, p. 44

“The purchase of a bargain issue presupposes that the market's current appraisal is wrong, or at least that the buyer's idea of value is more likely to be right than the market's. In this process the investor sets his judgement against that of the market. To some this may seem arrogant or foolhardy.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter II, The Investor and Stock-Market Fluctuations, p. 38

Idea

“It is a fact worth pondering that four centuries ago the evil of "an abundance or surplus" arose from its being kept off the market, while today the evil of surplus lies in its being thrown upon the market.”

Benjamin Graham

Part I, Chapter II, Government and Surplus Stocks, p. 28
Storage and Stability (1937)

Evil

“The investor has the benefit of the stock market's daily and changing appraisal of his holdings, for whatever that appraisal may be worth, and, second, that the investor is able to increase or decrease his investment at the market's daily figure—if he chooses. Thus the existence of a quoted market gives the investor certain options which he does not have if his security is unquoted. But it does not impose the current quotation on an investor who prefers to take his idea of value from some other source.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter II, The Investor and Stock-Market Fluctuations, p. 41

Quotes , Idea , Change

“In most cases the favorable price performance will be accompanied by a well-defined improvement in the average earnings, in the dividend, and in the balance-sheet position. Thus in the long run the market test and the ordinary business test of a successful equity commitment tend to be largely identical.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter II, The Investor and Stock-Market Fluctuations, p. 25

Business , Success

“In the short-run, the market is a voting machine - reflecting a voter-registration test that requires only money, not intelligence or emotional stability - but in the long-run, the market is a weighing machine.”

Benjamin Graham

Disputed

Money , Intelligence

“Why could the typical investor expect any better success in trying to buy at low levels and sell at high levels than in trying to forecast what the market is going to do? Because if he does the former he acts only after the market has moved down into buying levels or up into selling levels. His role is not that of a prophet but of a businessman seizing clearly evident investment opportunities. He is not trying to be smarter than his fellow investors but simply trying to be less irrational than the mass of speculators who insist on buying after the market advances and selling after it goes down. If the market persists in behaving foolishly, all he seems to need is ordinary common sense in order to exploit its foolishness.”

Benjamin Graham

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter II, The Investor and Stock-Market Fluctuations, p. 31

Sense , Success