Category: Notes

Volatility is not a measure of risk…. Risk comes from the nature of certain kinds of businesses. It can be risky to be in some businesses just by the simple economics of the type of business you’re in, and it comes from not knowing what you’re doing. And if you understand the economics of the business in which you are engaged, and you know the people with whom you’re doing business, and you know the price you pay is sensible, you don’t run any real risk.

– Warren Buffett

I have always been attracted to the low cost operator in any business and, when you can find a combination of (i) an extremely large business (ii) a more or less homogenous product, and (iii) a very large gap in operating costs between the low cost operator and all of the other companies in the industry, you have a really attractive investment situation.

– Warren Buffett

Man, as a social animal who has the gift of language, is born to prattle and to pour out twaddle that does much damage when serious work is being attempted. Some people produce copious amounts of twaddle and others very little.

– Charlie Munger

“People are credulous creatures who find it very easy to believe and very difficult to doubt. In fact, believing is so easy, and perhaps so inevitable, that it may be more like involuntary comprehension than it is like rational assessment.”

– Daniel Gilbert

The key to making great investments is to assume that the past is wrong, and to do something that’s not part of the past, to do something entirely differently.

– Don Valentine

Where men heretofore laboured twelve hours they would now labour six, and this is national wealth, this is national prosperity… Wealth is liberty– liberty to seek recreation–liberty to enjoy life–liberty to improve the mind: it is disposable time, and nothing more.

– Link

I tell my kids, what is the difference between a hero and a coward? What is the difference between being yellow and being brave? No difference. Only what you do. They both feel the same. They both fear dying and getting hurt. The man who is yellow refuses to face up to what he’s got to face. The hero is more disciplined and he fights those feelings off and he does what he has to do. But they both feel the same, the hero and the coward. People who watch you judge you on what you do, not how you feel.

– Cus D’amato

It’s the best possible time to be alive, when almost everything you thought you knew is wrong.

– Tom Stoppard, Arcadia

The things that everybody feels good about are likely to be the things that are high priced and the things that everybody feels bad about are likely to be low priced, so if you could find a stock that nobody thinks this company could ever have a good day, maybe there’s a chance that it could produce some favourable surprises and make you a lot of money.

We make money from favourable surprises, and if the positive conviction is so high, then by definition there can never be a favourable surprise.

– Howard Marks