Vision and patience in investing are attributes that the greatest investors seem to demonstrate time and again. They often emphasize the importance of looking beyond short-term fluctuations to understand where a company or market is headed.
Most brilliant traders highlight patience as an essential trait that allows them to see beyond the noise and focus on the core potential of an investment.
Vision and Patience
Stan Druckenmiller: “Never buy the present, always buy the future.”
Peter Thiel: “Look for companies that are monopolies in disguise; they operate in markets small enough not to attract competition, allowing them to dominate.”
Warren Buffett: “The stock market is designed to transfer money from the active to the patient.”
David Tepper: “When it comes to investing, there’s no ‘tomorrow’. It’s only about ‘today’.”
Bill Ackman: “Take the long-term perspective, but act when the short-term opportunity is compelling.”
Stanley Druckenmiller: “The best investors are often the best at waiting.”
Jeff Bezos: “Focus on things that won’t change over time—they have lasting value.”
Andrew Carnegie: “Put all your eggs in one basket and then watch that basket.”
Ray Dalio: “Realize you know less than you think you do.”
Phil Fisher: “The best time to sell a stock is almost never. Hold onto great companies through their growth phases unless something fundamentally changes.”
Risk Management and Diversification
If you want to be successful, you need to manage risk well. Knowing when to concentrate on a position, how to size it and when to hold are back key to long-term success.
If you want to sustain long-term returns, you need to learn how to protect capital.
Ray Dalio: “Diversification can reduce risk without reducing returns if done correctly.”
Paul Tudor Jones: “The most important rule of trading is to play great defense, not great offense.”
Carl Icahn: “Invest in companies where you see management taking ownership and making decisions to improve the company’s performance.”
Charlie Munger: “Invert, always invert. Approach your analysis by asking how it could go wrong and how to avoid losses.”
Bill Gates: “Decisions in investing are easier when you fully understand what you own.”
David Swensen: “Ignore market noise—focus on long-term returns.”
Bruce Flatt: “Operate with a margin of safety, especially in markets with unpredictable risk.”
Mohnish Pabrai: “When low-risk opportunities arise, take them with significant weight.”
Seth Klarman: “Margin of safety is critical. Look for opportunities where your analysis shows significant undervaluation.”
George Soros: “When in doubt, get out. Small losses are easier to recover from than large ones.”
Market Psychology and Cycles
Markets move in cycles and spotting these unusual patterns has proven to be an edge in investing for investors who see past the day to day ups and downs to the broader picture.
If you want to know when to buy, sell and hold, take a step back from time to time.
Howard Marks: “When things are really good, they’re probably not as good as they seem, and when they’re really bad, they’re probably not as bad as they seem.”
Michael Steinhardt: “Follow your instinct over market trends or popular opinions.”
George Soros: “Markets are always on the verge of uncertainty, so use reflexivity. Understand that your actions can influence the outcome.”
Michael Burry: “Ignore the noise. When you believe in a trade, tune out short-term price fluctuations and media hype.”
Howard Marks: “It’s often easier to know when a market is overheated than when it’s undervalued.”
Ray Dalio: “Master the cycles. Identify where we are in a market cycle and adjust risk levels accordingly.”
Michael Steinhardt: “Practice variant perception: If everyone is bullish, look for reasons to be bearish, and vice versa.”
Larry Fink: “Follow the money flow. Pay attention to sectors and trends attracting institutional investments.”
Peter Lynch: “Averaging down on a losing stock is dangerous if you’re wrong about the company.”
David Tepper: “Don’t fight the Fed. Policy often influences asset prices more than fundamentals.”
Investment Strategy & Edge
Alpha is the return you make above the market and to generate alpha you need an “edge” but how do you find it?
For some, it’s a specialized approach, while others focus on their strengths to capitalize on their insights to identify undervalued opportunities.
Ken Griffin: “Great investments require bold decisions and the willingness to act with conviction.”
Jeff Bezos: “If you only do things where you know the answer in advance, your company goes away.”
Mark Cuban: “Cash is king. In volatile times, holding cash gives you the flexibility to capitalize on bargains.”
Larry Robbins: “Invest in companies where management has skin in the game—they’re more likely to prioritize shareholder value.”
Jim Simons: “Focus on data and statistical models; don’t let intuition or emotion override the math.”
Ken Fisher: “Stock prices often follow earnings. Prioritize companies with a clear path to earnings growth.”
George Soros: “When you’re right, be bold. Small positions rarely generate meaningful returns.”
Joel Greenblatt: “Seek out businesses with high returns on capital and a durable competitive advantage.”
Mohnish Pabrai: “Find investments with ‘Heads, I win; tails, I don’t lose much’ situations for asymmetric payoff.”
Leon Cooperman: “Watch insider buying—it’s often a strong signal of confidence in the company’s future.”
Contrarian Thinking and Asymmetry
To really win long-term you often have to be a contrarian and take the other side of the market when it’s hardest to do so.
Contrarian thinking and asymmetric bets are powerful tools in identifying these hidden gems.
Carl Icahn: “Know the power of activist investing. Look for companies where your stake can help unlock hidden value.”
Howard Marks: “The price you pay for a good stock still matters.”
Paul Tudor Jones: “Your best investment can sometimes be what you don’t do. Master patience and restraint.”
Bill Ackman: “Find asymmetric risk-reward situations: low downside, high upside potential.”
Stanley Druckenmiller: “Avoid adding to a losing position. Scale up winners and let the momentum guide your allocations.”
David Einhorn: “Look for management integrity. A stock is only as good as the team running the company.”
Peter Lynch: “Don’t overcomplicate it. If you can’t explain the company in a few sentences, it’s probably not worth your time.”
David Tepper: “If something seems too good to be true, it usually is. Conduct extensive research to avoid value traps.”
Bruce Kovner: “Focus on preserving capital above all else; surviving the game is the only way to win long-term.”
Warren Buffett: “Reputation takes years to build but seconds to ruin. Ensure companies have strong ethics.”
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