Some times it’s helpful to consider the wisdom of the sages for helpful investment guidance. At other times they’re good for some laughs–unintentionally. Here’s some intentional humor from an old guy along with some choice conventional and not-so-conventional wisdom.
I plumbed the depths of Classics – An Investors Anthology and found an article called “Toward Bridging the Gap: Capital Market Theory and Money Management via Codification of the Conventional Wisdom.” The article was published in the January/February 1978 edition of The Financial Analysts Journal. The code of conventional wisdom extends for several pages and I include some choice excerpts here.
561234-17-6 When everybody likes a stock, it must go down; when nobody likes a stock, it may go up.
169812-44-5 No tree grows to the sky.
624318-98-2 Sell your losers and let your runners run.
247914-43-7 Never say never.
223546-68-3 Never say die.
375463-28-9 Never confuse brilliance with a bull market.
454189-52-4 More stocks double than go to zero.
272451-79-9 All generalizations are false, including this one.
235725-93-6 In a bull market, be bullish
756336-45-8 The bottom is always 10 per cent below your worst case expectation.
318940-63-2 There are no customers’ yachts.
012644-73-6 Risk is what’s left over after the bad news hits.
126351-30-3 The first word in analyst is anal.
725541-61-8 If you know what’s going on, you don’t have to know what’s going on to know what’s going on.
517980-24-2 Beauty is only skin deep, but in many cases, that’s deep enough.
758423-51-3 You only need two research sources ona a stock if one is a bull and one is a bear
368921-41-3 Not to decide is to decide.
953174-36-4 The budget will not be balanced in your lifetime.
597632-39-9 Bulls make money and bears make money, but pigs get swine flu [again, written in 1978]
234445-85-4 Ten doubles will make one million dollars out of one thousand.
513792-63-8 A lot of things aren’t worth knowing
521598-14-3 Cyclic stocks should be bought when their multiples are high and sold when their multiples are low.
771234-59-4 Growth will bail you out–if you live long enough.
471352-35-6 You will lose most 50-50 bets.
245988-47-5 Every time a trade is made, somebody was wrong.
494847-40-9 Two things cause a stock to move–the expected and the unexpected.
657124-33-5 There are no atheists in foxholes nor conservatives when the subsidies are being passed out.
445010-75-3 You drink too much coffee.
293949-28-6 Sell down to your sleep point.
675680-84-4 The stock doesn’t know you own it.
161514-74-8 Shake well before using.
698754-13-3 You can’t spend relative performance.
729360-75-8 Be long term but watch the ticks.
334372-42-6 Too many cooks spoil the broth.
351723-38-1 A portfolio that goes down 50% and comes back 50% is still down 25%.
828381-54-3 Never average down.
651789-37-4 There are no one-decision stocks.
796854-32-6 The market will fluctuate.
894105-04-3 About half the people in your shop are pulling their weight.
183327-13-5 Miss at least one meeting a day.
271143-92-6 Bad as it is, ther are some people who’d like your job.
752999-12-3 Waste time only with people you like.
277693-32-7 There are no defensive stocks.
523501-11-5 He who knows not and knows that he knows not is a wise man.
321432-19-8 To err is human, to hedge divine.
393455-75-5 The trouble with statistical analysis is that the first seven kings of England named Henry had an average of 1.3 wives.
247459-80-6 A statesman is a dead politician.
029103-30-3 Price is a fundamental–it’s the only thing you know for sure about is a stock.
725611-73-9 The pen is mightier than the pencil.
674193-62-7 Buy on the rumor, sell on the news.
617852-29-2 Buy when you can’t find a bull.
828182-42-5 If the idea is right, eighths and quarters won’t matter.
Phwew, and that’s maybe a twentieth of them.