We are all of us richer than we think we are; but we are taught to borrow and to beg, and brought up more to make use of what is another's than of our own.

It is not enough to have a good mind; the main thing is to use it well. And the greatest souls are capable of the greatest vices as well as of the greatest virtues.

The market can stay irrational longer than you can stay solvent, but the deeper danger is that you'll convince yourself the irrationality is actually insight — that your losing position is just the world catching up to your genius.

The difference between a good investor and a great one isn't IQ or information — it's temperament. The great investor behaves as if the market is there to serve him, not to instruct him. Most people get this exactly backwards, which is why most people shouldn't be managing their own money.

The surest way to corrupt a youth is to instruct him to hold in higher esteem those who think alike than those who think differently.

The difference between a good business and a great one is that a great one makes it hard to compete against it. A good one merely makes it hard to make money. The best business is one where you can keep repricing upward without losing customers—that's when you know you own something real.

The human mind is not, as philosophers would have you think, a debater, but a dreamer. The function of the intellect is not to distinguish truth from falsehood, but to make whichever it chooses more vivid and persuasive than it could otherwise be.

It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change. Yet we mistake adaptability for weakness, and call stubbornness character.

The universe is transformation; life is opinion. If you are distressed by anything external, the pain is not due to the thing itself but to your own estimate of it; and this you have the power to revoke at any moment.

Forgetting that your returns depend on the returns of the businesses you own—not on what you paid for them—is the source of more investment error than almost any other mistake I can think of. You must always ask: what will this business earn over time? Everything else is noise.

Nothing is so perfectly amusing as a total change of ideas; a man who has been beating his brains against a problem all week is in excellent condition to be amused.

The tendency of modern scientific teaching is to neglect the great books, to lay far too much stress on the minute study of details, and to overlook the great generalizations. It is the study of generalizations that liberates the human mind.

The stock market is a device for transferring money from the impatient to the patient. But patience itself is not a strategy — you must also be right about what you're waiting for.

The fish trap exists because of the fish; once you've gotten the fish, you can forget the trap. Words exist because of meaning; once you've gotten the meaning, you can forget the words. Where can I find a man who has forgotten words so that I can have a word with him?

The biggest competitive advantage in business and investing is a quiet life that allows for more time to think. Being perpetually busy is a social signal, not a productivity strategy—and the market rewards those who can sit still long enough to see what others are too distracted to notice.

We are more often frightened than hurt; and we suffer more in imagination than in reality.

Nothing in the universe can travel at the speed of light, they say, forgetful of the shadow's speed.

A stock is not just a ticker symbol or an electronic blip; it is an ownership interest in an actual business, with an underlying value that does not depend on its share price. The market is there to serve you, not to instruct you.

We are in the habit of imagining our lives to be linear, a long march from birth to death. But they are in fact constantly renewed, and the great events of our lives happen again and again.

The best investment you can make is in businesses you understand, and the second-best is in your own ability to understand more businesses. Most investors do neither — they buy what's rising and call it research.

It is not enough to be industrious; so are the ants. What are you industrious about?

The universe is a series of collapsed probabilities. What we call history is merely the thread that happened to hold — and we mistake the thread for the loom.

You have to be willing to look wrong for a long time before you look right. The market has no obligation to validate your thesis on your schedule.

Mimicking the herd invites regression to the mean. You will never produce a superior performance unless you do something different from the majority — and that is harder than it sounds, because the majority is usually wrong about enough things to be dangerous, but right about enough things to be seductive.

It is not the horse that draws the cart, but the oats. And yet we always speak of the horse.

Invert, always invert. Many hard problems are best solved when you turn them around in reverse. It is not enough to think about what you want — think equally hard about what you want to avoid, and you will find that removing stupidity is often more valuable than adding brilliance.

We are apt to think that our ideas and feelings are our own, and feel a sort of pride in them; but these we have been long accumulating, borrowing, stealing from the great store of the world's knowledge, and they are really the outcome of thousands of years of thought.

The best business returns are usually achieved by companies that are doing something that is quite easy to understand. The trick is getting first to a strong market position and then exploiting the advantages that follow. What you want is a natural franchise. A company can have a perfectly marvelous product and still be in a lousy business.

The universe is under no obligation to make sense to you.

Risk means more things can happen than will happen. The practical definition of risk is not volatility or a standard deviation — it's the possibility of permanent loss of capital. Volatility is opportunity dressed in frightening clothes.

The record of a money manager who merely stays close to the market is not an outstanding record—it is a record of someone who has successfully rationalized doing nothing. The question is not whether you beat the market, but whether you had the intellectual honesty to know when you had no edge and the discipline to act accordingly.

It is the mark of an educated mind to be able to entertain a thought without accepting it.

It is not the answer that enlightens, but the question. Déceler, c'est créer. To detect is to create.

A thought which does not result in an action is nothing much, and an action which does not proceed from a thought is nothing at all.

The market for something to believe in is infinite. But the market for something that actually works is much smaller, and far more competitive. Most investors confuse the two.

The art of living is more like wrestling than dancing, in so far as it stands ready against the accidental and the unforeseen, and is not apt to fall.

The ability to destroy value is not confined to bad businesses. A great business bought at too high a price, or managed by people who can't resist the temptation to allocate capital to adjacencies, will also destroy value. The label 'great business' is not a perpetual warranty.

Investors often make the mistake of confusing a exciting industry with a profitable one. The trick is not to find industries that are growing fast, but to find companies that can keep competitors from eating their lunch.