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We are value investors because we are persuaded of the logic of buying shares of businesses when others want to sell them, and we understand that lower prices today mean higher future rates of return, and high prices today mean lower future rates of return.
—Bill Miller
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You have to have the courage of your convictions. That’s what you are getting paid for. This is the time when you really earn your money.
—Bruce Berkowitz
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The idea that very smart people with investment skills should have hugely diversified portfolios is madness. It’s a very conventional madness. And it’s taught in all the business schools. But they’re wrong.
—Charlie Munger
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Obsession with broad diversification is the sure road to mediocrity.
—John Neff
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In small portfolios, I’d be comfortable owning between three and ten stocks.
—Peter Lynch
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There is no sense diluting your best ideas or favorite situations by continuing to work your way down a list of attractive opportunities.
—Joel Greenblatt
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Concentrated investing implies less risk of permanent loss as long as you maintain superior knowledge about the companies you own.
—Bruce Berkowitz
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The disadvantage of having eggs in so many baskets is that a lot of eggs do not end up in really attractive baskets, and it is impossible to keep watching all the baskets after the eggs are put in.
—Philip Fisher
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Take extreme care to own not the most, but the best.
—Philip Fisher
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Hold no more stocks than you can remain informed on.
—Peter Lynch
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In the field of common stocks, a little bit of a great many can never be more than a poor substitute for a few of the outstanding.
—Philip Fisher
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The greater the potential for reward in the value portfolio, the less risk there is.
—Warren Buffett
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Very few people have gotten rich on their seventh best idea.
—Warren Buffett
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It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.
—John Maynard Keynes
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An investor should act as though he had a lifetime decision card with just twenty punches on it.
—Warren Buffett
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The idea that it is hard to find good investments, so concentrate in a few, seems to me to be an obvious idea.
—Charlie Munger
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Diversification is protection against ignorance. Risk can be greatly reduced by concentrating on only a few holdings.
—Warren Buffett
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Patience can produce uncommon profits.
—Philip L. Carret
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Diversification is only a surrogate, and usually a poor surrogate, for knowledge, control, and price consciousness.
—Martin Whitman
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The theory of scattering one’s investments over as many fields as possible might be the wisest plan on the assumption of comprehensive ignorance.
—John Maynard Keynes
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Buying a company without having sufficient knowledge of it may be even more dangerous than having inadequate diversification.
—Philip Fisher
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Usually a very long list of securities is not a sign of the brilliant investor, but of one who is unsure of himself.
—Philip Fisher
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Wide diversification is only required when investors do not understand what they are doing.
—Warren Buffett
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All intelligent investing is value investing — acquiring more than you are paying for. You must value the business in order to value the stock.
—Charlie Munger
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Put all your eggs in one basket — and then watch that basket!
—Andrew Carnegie
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There’s no use diversifying into unknown companies just for the sake of diversity. A foolish diversity is the hobgoblin of small investors.
—Peter Lynch
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A well-diversified portfolio needs just four stocks.
—Charlie Munger
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Price is what you pay; value is what you get.
—Benjamin Graham
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The hard part is discipline, patience, and judgement. Investors need discipline to avoid the many unattractive pitches that are thrown, patience to wait for the right pitch, and judgement to know when it is time to swing.
—Seth Klarman
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Diversification is protection against ignorance. Risk can be greatly reduced by concentrating on only a few holdings.
—Warren Buffet
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It is undoubtedly better to concentrate on one stock that you know is going to prove highly profitable, rather than dilute your results to a mediocre figure, merely for diversification’s sake.
—Benjamin Graham
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Diversification is a poor substitute for knowledge.
—Martin Whitman
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What an investor needs is the ability to correctly evaluate selected businesses. Note that word ‘selected’: You don’t have to be an expert on every company, or even many.
—Warren Buffett
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If you are a professional and have confidence, then I would advocate lots of concentration.
—Warren Buffett
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The single greatest edge an investor can have is a long-term orientation.
—Seth Klarman
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It makes sense that if you limit your investments to those situations where you are knowledgeable and confident, and only those situations, your success rate will be very high.
—Joel Greenblatt
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In my view, it’s best to own as many stocks as there are situations in which (a) you’ve got an edge; and (b) you’ve uncovered an exciting prospect that passes all the tests of research.
—Peter Lynch
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Great investors are not unemotional, but are inversely emotional — they get worried when the market is up and feel good when everyone is worried.
—Bill Miller
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A stock is not just a ticker symbol or an electronic blip; it is an ownership interest in an actual business, with an underlying value that does not depend on its share price.
—Benjamin Graham
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Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble.
—Warren Buffett
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We believe that a policy of portfolio concentration may well decrease risk if it raises, as it should, both the intensity with which an investor thinks about a business and the comfort-level he must feel with its economic characteristics before buying into it. In stating this opinion, we define risk, using dictionary terms, as ‘the possibility of loss or injury.’
—Warren Buffett
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It’s crazy to put money in your twentieth choice rather than your first choice.
—Warren Buffett
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It is often easier to tell what will happen to the price of a stock than how much time will elapse before it happens.
—Philip Fisher
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The most successful horse players (I guess they lose the least) are the ones who don’t bet on every race but wager on only those occasions when they have a clear conviction.
—Joel Greenblatt
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No prudent investor puts all the eggs in a single basket. But too much diversification hobbles performance.
—John Neff
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One’s knowledge and experience are definitely limited and there are seldom more than two or three enterprises at any given time, in which I personally feel myself entitled to put full confidence.
—John Maynard Keynes
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Sweet are the uses of diversity, but only if you want to end up in the middle of an average.
—The Money Game
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It is also a fact that the more stocks you own the less you know about each of them and I have never found a theory of investment that suggests that the less you know about something, the more likely you are to generate superior returns.
—Terry Smith
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The whole secret of investment is to find places where it’s safe and wise to non-diversify. It’s just that simple. Diversification is for the know-nothing investor; it’s not for the professional.
—Charlie Munger
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Investors have been so oversold on diversification that fear of having too many eggs in one basket has caused them to put far too little into companies they thoroughly know and far too much in others which they know nothing about.
—Philip Fisher
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My theory of risk is that it is better to take a substantial holding of what one believes in than scatter holdings in fields where he has not the same assurance.
—John Maynard Keynes
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Good investment ideas — that is, companies that meet our criteria, are difficult to find. When we have found one, we make a large commitment.
—Lou Simpson
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My view is that an investor is better off knowing a lot about a few investments than knowing a little about each of a great many holdings. One’s very best ideas are likely to generate higher returns for a given level of risk than one’s hundredth or thousandth best idea.
—Seth Klarman
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IF YOU INVEST LIKE NO ONE ELSE INVESTS,
YOU GET RESULTS NO ONE ELSE GETS!
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There’s lots of stocks out there and all you need is a few of them. That’s been my philosophy.
—Peter Lynch
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You only have to be able to evaluate companies within your circle of competence. The size of that circle is not very important; knowing its boundaries, however, is vital.
—Warren Buffett
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