20 Quotes from The Education of a Value Investor book by Guy Spier

The Education of a Value Investor

Hello. This post is a collection of 20 quotes from the book - The Education of a Value Investor by Guy Spier. I hope you enjoy reading these quotes.

The Education of a Value Investor Quotes

We like to think that we change our environment, but the truth is that it changes us. So we have to be extraordinarily careful to choose the right environment—to work with, and even socialize with, the right people. Ideally, we should stick close to people who are better than us so that we can become more like them.

Value investors have to be able to go their own way. The entire pursuit of value investing requires you to see where the crowd is wrong so that you can profit from their misperceptions.

As investors, we all have shortcomings; as I came to see it, the key is to accept who we are, understand our differences and limitations, and figure out ways to work around them.

In the financial markets, envy is a silent killer: it leads people to behave in ways they wouldn’t if they were more honest with themselves.

We often bring bad things on ourselves when we point the finger at others or act in a tyrannical way. In my experience, it’s karmically better to focus on the positive and act as a force for good instead of getting gratuitously embroiled in acrimonious battles.

Misalignment is a dangerous thing, not just in relationships but in business and investing.

Value investors pride themselves on being able to buy when the market is imploding. We like to think that we possess the calmness, courage, and strength—not to mention the intellectual clarity and understanding—to act rationally when almost everyone else is panicking.

From a societal point of view, debt is a vital economic lubricant. Used in moderation, it’s positively healthy. But for an individual investor, debt can be disastrous, making it even harder to stay in the game—both financially and emotionally—when the market turns against you.

One of the biggest challenges for any investor is that there are so many forces that mess with our minds. We like to think of ourselves as rational creatures—which, to some extent, we are—but the truth is a little murkier.

Here we are—with our little irrational brains and our overly simplistic economic theories—somehow hoping to make sense of this unbelievably complex world. What chance do we have?

The truth is that it’s hard to invest well if your non-investing life is out of whack, in chaos, or stunted.

Many investments are acutely uncertain, but not as risky as they might at first seem. People often assume that investors like me are great risk takers, perhaps little more than gamblers. Certainly, there are plenty of reckless investors with scant regard for the risk of loss, but they tend not to survive very long in the investing game. The long-term survivors possess a more sophisticated grasp of risk, including the ability to see when the situation is much less risky than the stock price might suggest.

Pilots internalize an explicit set of rules and procedures that guide their every action and ensure the safety of themselves and their passengers. Investors who are serious about achieving good returns without undue risk should follow their example. Why? Because in investing, as in flying, human error can be a bitch.

For my purposes, it’s important not to prioritize news stories, since they give my brain reasons to act, often without providing real substance. The corporate filings are my meat and vegetables—less enjoyable, but usually more nutritious.

Keep the market at a safe distance. Don’t let it invade your office or your brain.

Personally, I don’t want to invest in companies that make society worse even if their products are legal. Call me irrational, but I think it’s bad karma.

If I pay too much up front, I’d better understand everything there is to know about the company since there is no margin of safety. If I invest when it’s undervalued, I can be wrong about a whole host of issues and still make a good return.

Irrational exuberance comes and goes. The quest for value endures.

In my experience, the inner journey is not only more fulfilling but is also a key to becoming a better investor. If I don’t understand my inner landscape—including my fears, insecurities, desires, biases, and attitude to money—I’m likely to be mugged by reality.

The stock market has an uncanny way of finding us out, of exposing weaknesses as diverse as arrogance, jealousy, fear, anger, self-doubt, greed, dishonesty, and the need for social approval. To achieve sustainable success, we need to confront our vulnerabilities, whatever they may be. Otherwise, we are building our success on a fragile structure that is ultimately liable to fall down.

Quotes by - Deepak Kundu

Hello, I am Deepak Kundu, an avid book reader and quotes collector. I hope you enjoyed reading the above quotes from The Education of a Value Investor book by Guy Spier.