Spend at least as much time researching a stock as you would choosing a refrigerator.
If you can't find any companies that you think are attractive, put your money in the bank until you discover some.
When you sell in desperation, you always sell cheap.
My method for picking stocks has never changed. When businesses go from crappy to semicrappy, there's money to be made.
An important key to investing is to remember that stocks are not lottery tickets.
The stock market really isn't a gamble, as long as you pick good companies that you think will do well, and not just because of the stock price.
There's no use diversifying into unknown companies just for the sake of diversity. A foolish diversity is the hobgoblin of small investors. That said, it isn't safe to own just one stock, because in spite of your best efforts, the one you choose might be the victim of unforeseen circumstances. In small portfolios, I'd be comfortable owning between three and ten stocks.
It only takes a handful of big winners to make a lifetime of investing worthwhile.
What makes stocks valuable in the long run isn't the market. It's the profitability of the shares in the companies you own. As corporate profits increase, corporations become more valuable and sooner or later, their shares will sell for a higher price.
I've always said, the key organ here isn't the brain, it's the stomach. When things start to decline - there are bad headlines in the papers and on television - will you have the stomach for the market volatility and the broad-based pessimism that tends to come with it?
You have to let the big ones make up for your mistakes.
Long shots almost always miss the mark.
If you're prepared to invest in a company, then you ought to be able to explain why in simple language that a fifth grader could understand, and quickly enough so the fifth grader won't get bored.
I deal in facts, not forecasting the future. That's crystal ball stuff. That doesn't work.
I can't recall ever once having seen the name of a market timer on Forbes' annual list of the richest people in the world. If it were truly possible to predict corrections, you'd think somebody would have made billions by doing it.
Investing is fun and exciting, but dangerous if you don't do any work.
The best stock to buy is the one you already own.
Average investors can become experts in their own field and can pick winning stocks as effectively as Wall Street professionals by doing just a little research.
Stocks are a safe bet, but only if you stay invested long enough to ride out the corrections.
Hold no more stocks than you can remain informed on.
Invest in what you know.
The Rule of 72 is useful in determining how fast money will grow. Take the annual return from any investment, expressed as a percentage, and divide it into 72. The result is the number of years it will take to double your money.
There is always something to worry about. Avoid weekend thinking and ignoring the latest dire predictions of the newscasters. Sell a stock because the company's fundamentals deteriorate, not because the sky is falling.
You get recessions, you have stock market declines. If you don't understand that's going to happen, then you're not ready, you won't do well in the markets.
The person that turns over the most rocks wins the game. And that's always been my philosophy.
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