Mr. Market, the imaginary investor in Ben Graham’s book, The Intelligent Investor, is willing to constantly buy or sell a stock based on whether it has recently gone up or down. Yet, these actions are based on the emotion of recent events, and not on sound investing principles. Ben Graham’s most famous student, Warren Buffett, understands the importance of keeping his emotions in check and during the 3rd quarter when Mr. Market was overly optimistic, Warren chose to “be fearful when others are greedy”.
As we previously stated in our prior blog post, The Intelligent Investor, Ben Graham said, “The typical experience of the speculator is one of temporary profit and ultimate loss”. These manic-depressive investors (aka Mr. Market) will eventually learn some very old lessons.
Disclosure: BFSG does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to BFSG’s web site or blog or incorporated herein and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly. Please see important disclosure information here.