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The Top Investment Quotes Every Investor Should Know



This infographic is available as a poster.

Investment Quotes

Investment Quotes

This infographic is available as a poster.

The Top Investment Quotes Every Investor Should Know

Quotes can have lasting impressions. They can also tell a story.

From Warren Buffett to John Maynard Keynes, the financial greats offer insights that often last for decades. Not only have they lived through several market cycles, their understanding of the market is foundational to their success.

In this infographic from New York Life Investments, we distill five timeless investment quotes and explore the data behind their insight.

Top 5 Investment Quotes for Investors

What investment quotes can we learn from today?

1. “The most important quality for an investor is temperament, not intellect.”

— Warren Buffett, CEO of Berkshire Hathaway

Often, emotions influence trading activity. Consider how investors traded 10x more in the first quarter of 2020 than in 2009.

Here are three fear indicators that can lead to these trading spikes:

  • Volatility: Higher Cboe Volatility Index (VIX) reading indicates higher fear.
  • Stock Price Strength: A greater number of stocks reaching 52-week lows versus 52-week highs indicates higher fear.
  • Bond vs. Stock Performance: When bonds outperform, it can indicate higher fear.

Yet, in spite of extreme investor fear, the S&P 500 has proven resilient. The index had positive performance in 32 of the last 42 years.

2. “The individual investor should act consistently as an investor and not as a speculator.”

— Benjamin Graham, author of The Intelligent Investor

Benjamin Graham, the father of value investing, had an enormous influence on Warren Buffett. One of his many core insights includes recognizing the difference between an investor and a speculator:

  • Investor: Focused on safety of principal and reasonable return.
  • Speculator: At risk of losing potentially the entire principal.

Rather than seeing an investment as simply a ticker symbol, Graham says, think of an investment like having a partial ownership in a business.

When investors think like an owner, they look for the intrinsic value of the company in the long term, which can compound in value over time.

TimeMonthly ContributionAnnual ReturnInterest Earned on Investments
Year 1$2007%$14
Year 11$2007%$231

In a relatively short period of time, the investor is earning $231 on a $200 monthly contribution.

3. “The biggest risk of all is not taking one.”

— Mellody Hobson, co-CEO of Ariel Investments

Mellody Hobson, co-CEO of Chicago-based Ariel Investments, became president at just 31. Today, Ariel manages over $18 billion in assets. As the head of two major firms (she is also chairwoman of Starbucks), Hobson understood the importance of taking the first step.

We show an example of a potential benefit of starting early:

InvestorContribution TimelineMonthly ContributionAnnual Rate of ReturnTotal Contribution AmountEnd Portfolio Value
Investor AAge 25-35$2007%$24,000~$300,000
Investor BAge 35-65$2007%$72,000$245,000

As the above table shows, Investor A contributed just $24,000, outperforming Investor B—who contributed 3x more ($72,000) over their lifetime. By age 65, Investor A’s portfolio value was worth nearly $300,000 while Investor B’s stood at $245,000.

Investing early is especially timely given today’s inflationary environment. Over time, inflation erodes the value of the dollar and, in turn, a person’s overall wealth.

4. “Time in the market beats timing the market.”

— Ken Fisher, founder of Fisher Investments

If an investor tried to time the market and missed the best performing days over the last century, they would have earned just a fraction of the total returns. Staying invested led to over 17,000% returns, yet missing the 10 best days over each decade led to returns of just 28%:

DecadeS&P 500 Price ReturnExcluding Best 10 Days Per Decade

Source: Bank of America, S&P 500 returns (Mar 2021)

Historically, the biggest drops in the market often happen just before the largest upswings, meaning that opportunities can be easily missed.

Even the top investors have trouble timing the market at every turn.

5. “It is better to be roughly right than precisely wrong.”

— John Maynard Keynes, father of modern macroeconomics

When markets are volatile, diversification can help investors temper its effects. Consider the following example that shows the advantages of diversification.

Annual Total Returns 1950-2020Large Cap EquityBonds50/50 Portfolio
1-Year Rolling Low-39%-8%-15%
1-Year Rolling High47%43%33%

Source: Bloomberg Finance L.P., FactSet, J.P. Morgan Asset Management; Robert Shiller, Strategas/Ibbotson, US Federal Reserve (2021)

When investors blended stocks and bonds in their portfolios over a one year period, the downside was sharply reduced.

Annual Total Returns 1950-2020Large Cap EquityBonds50/50 Portfolio
5-Year Rolling Low-3%-2%1%
5-Year Rolling High28%23%21%

Source: Bloomberg Finance L.P., FactSet, J.P. Morgan Asset Management; Robert Shiller, Strategas/Ibbotson, US Federal Reserve (2021)

Meanwhile, over the last seven decades, a combination of stocks and bonds has never produced a negative return across a five-year rolling period.

Learning from Historical Insight

The above five investment quotes can arm investors with investing lessons that often are easy to forget:

  • React logically, not emotionally
  • Leverage compound interest
  • Start early
  • Stay invested
  • Diversify

With insights drawn from those who have shaped the financial world, investors can better position their portfolios for success.

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How Experts Think About Bear Market Opportunities

We look at quotes from investing legends like Warren Buffett and Peter Bernstein to take cues on how investors should approach a down market.



How Experts Think About Bear Market Opportunities

Today, the majority of Americans are worried a bear market is looming.

The good news: there are silver linings. Bear markets can present bargains for investors, thanks to inefficient pricing and fear in the market. Going further, many investing greats have made key investments during market downturns including:

  • Warren Buffett: Automotive sector during the 2008 Global Financial Crisis
  • Shelby Davis: Financial sector during the 1997 Asian Financial Crisis
  • Peter Bernstein: Gold during the 2000 Dot-Com Crash

In this infographic from New York Life Investments, we show four quotes on bear market opportunities and the data behind their insight.

How Experts Think About Bear Market Opportunities

When faced with the challenges of a bear market, how do experts respond?

1. “Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.”

— Warren Buffett, CEO of Berkshire Hathaway

Just like a bargain on socks may be an opportunity for buyers, a bargain on stocks is an opportunity for potential upside. In fact, the S&P 500 Index has seen double-digit gains 85% of the time after extremely pessimistic sentiment since 1987.

Investor pessimism can be measured by a ‘bull-bear spread’. This is based on an AAII survey that measures investor expectations for the market in the next six months. It is calculated by taking the percentage of investors who are ‘bullish’ on the market minus those who are ‘bearish’.

For example, in the week of April 29, 2022:

  • Bullish: 16.4%
  • Bearish: 59.4%
  • Bull-Bear Spread: – 43

Here’s how the S&P 500 Index performed after periods of extreme investor pessimism:

DateBull-Bear SpreadS&P 500 Index
12-Month Return

Source: Bloomberg, 5/12/22

As the above chart shows, investor pessimism is at its highest in 20 years.

Instead of thinking of how bad the market is doing, investors may be better of thinking of the market as being significantly less expensive.

2. “History provides crucial insight regarding market crises: they are inevitable, painful, and ultimately surmountable.”

Shelby Davis, founder of Shelby Cullom Davis & Company

Bear markets hurt. On the bright side, they only account for 29% of the market environment, with bull markets making up the lion’s share (71%). What’s more, stocks have spent the vast majority of time at or near their all-time highs.

Market EnvironmentDescription% of Time in Market Environment
All-Time HighStock market hits all-time high35%
Bull Market DipStock market falls under 10% from all-time high33%
Bull Market CorrectionStock market falls over 10% but less than 20% from all-time high3%
Bear Market DrawdownStock market falls over 20% from peak to trough10%
Bear Market RecoveryTime it takes to reach next all-time high19%

Source: Morningstar Direct, PerformanceAnalytics, UBS 4/30/2022. Based on monthly returns from 1945.

Overall, stocks have spent around two-thirds of the time at or near all-time highs.

3. “The most important lesson an investor can learn is to be dispassionate when confronted by unexpected and unfavorable outcomes.”

— Peter Bernstein, economist and financial historian

To avoid falling for the behavioral pitfalls of a market cycle, investors can identify key macro indicators of each stage. Below, we show the economic indicators and how they associate with each type of market cycle.

Market CycleMonetary Policy Shock*Consumer SentimentEmploymentSalesPurchasing Managers Index (PMI)
BullPositivePositivePositiveHighly PositiveHighly
Highly NegativeHighly NegativeHighly

Source: Goulding, L. et al., May 2022. *Represents an unexpected move in monetary policy.

As the above table shows, bear markets are associated with low consumer sentiment, high unemployment, low corporate sales, and weak manufacturing performance—with a high number of macroeconomic shocks.

4. “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.”

— Winston Churchill, former Prime Minister of Britain

Just like bear markets can stoke investor uncertainty, rising interest rates can cause stock market disruption. However, since 1954 the S&P 500 Index has returned an average 9.4% annually during Fed rate hike cycles.

Fed Rate Hike CycleS&P 500 Index Annualized Total Return
Aug 1954 - Oct 195714%
Jun 1958 - Nov 195924%
Aug 1961 - Nov 19667%
Aug 1967 - Aug 19694%
Mar 1972 - Jul 1974-9%
Feb 1977 - Jun 198111%
Mar 1983 - Aug 198413%
Jan 1987 - May 198916%
Feb 1994 - Feb 19954%
Jun 1999 - May 200010%
Jun 2004 - Jun 20068%
Dec 2015 - Dec 20188%

Source: Morningstar, Haver Analytics, March 2022

Not only that, the S&P 500 Index has had positive returns 11 out of 12 times during periods of rising interest rates. Despite the short-term impact to the market, stocks often weather the storm.

Finding Bright Spots

In summary, it is helpful to remember the following historical characteristics of a bear market:

  • Extreme pessimism
  • Short-lived
  • Higher macroeconomic shocks (employment, sales, PMI)

Investors can find opportunities by considering a contrarian point of view and learning from the time-tested experience of investing legends.

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Retirement Savings: How to Calculate If You’re on Track

This graphic shows how to plan for sufficient retirement savings, and how the U.S. population measures up at each step.



Retirement savings by age group, to help people gauge their own retirement planning. Retirement balances get bigger until age 65-74 and go down for those over age 75.

This infographic is available as a poster.

Retirement Savings: How to Calculate If You’re on Track

Setting a retirement savings goal can be overwhelming. In fact, one in three Americans have no idea what they need to save to retire at their target age.

Luckily, we can use a retirement calculator to help outline what you need to consider. This graphic from New York Life Investments walks you through setting your retirement savings goal, and shows how the U.S. population measures up at each step.

Step 1: Your Age

A calculator will typically start by asking for your current age and your target retirement age. This is to determine how long you have left to build up your investments. In the U.S., the average age of retirement has remained relatively stable and is currently 62.

Keep in mind that your retirement age can depend on many factors:

  • Your cost of living
  • Your job satisfaction
  • Your debts
  • Your spouse’s retirement plan
  • Your health

After you have your projected retirement age figured out, you’ll also need to estimate the length of your retirement.

The life expectancy for Americans at birth is 77 years. Once you’ve lived to age 65, that number is higher. This is because you’ve survived many untimely causes of death, including the higher mortality associated with childhood. The below table shows how the expected age of death changes as you age.

 At BirthAt Age 65
Both Sexes7784

To estimate your particular lifespan, you’ll also need to consider things like your genetics and your lifestyle. Having an idea of how long you might live may help you better manage longevity risk, or the risk you’ll outlive your savings.

Step 2: Your Savings

The next step in setting your retirement savings goal is to take stock of how much you’ve already saved. For context, here is how much Americans have saved for retirement by age group.

 Median BalanceAverage Balance
< 35$13,000$30,170
> 75$83,000$357,920

You’ll also need to decide how much you’ll be putting toward your retirement each year. Experts typically recommend saving about 15% of your pre-tax income. This can include your employer’s contributions, if any. Of course, this amount will vary based on how early you start saving and when you plan to retire.

Your expected investment earnings will play a big role, too. Here is what average annual returns have been for different types of portfolios based on historical data from 1928-2021.

(80% bonds, 20% stocks)
(40% bonds, 60% stocks)
(20% bonds, 80% stocks)
Nominal Return8%10%11%
Real Return5%7%8%

Inflation has averaged about 3% each year. Remember to include inflation in your calculations so you can maintain purchasing power in retirement.

Step 3: Your Income

In the final step of setting your retirement savings goal, you’ll need to decide how much of your current household income you will use in retirement. Financial experts typically estimate you could need 70-80% of your pre-retirement income.

At this stage, it can be helpful to plan out a detailed budget. Here’s a spending overview for the average American over age 65.

CategoryAnnual Spending
Donations, Child and Spousal Support$3,119
Personal Insurance and Pensions$2,721
Alcohol and Tobacco$635

Other includes personal care products and services ($505), education ($450), reading ($157), and miscellaneous expenses ($921).

Now that you have an estimate of your expenses, you can factor in all sources of income you expect to receive in retirement. This helps narrow down what you need to have set aside in your retirement savings. For instance, most people collect Social Security in addition to their own pension. The below table shows what percentage of retirees have each income source.

SourceRetirees Age 65 and OlderAll Retirees
Social Security92%78%
Defined Contribution or Defined Benefit Pension66%57%
Interest, Dividends, or Rental Income49%43%
Wages, Salaries, or Self-employment25%32%
Cash Transfers Other Than Social Security7%11%

Respondents could select multiple answers. Sources include the income of a spouse or partner.

Based on all this information, a retirement calculator will estimate whether you are on track to sufficiently fund your retirement years.

Turning a Retirement Savings Strategy Into Action

It’s important to note that retirement calculators are a starting point. To come up with a customized strategy, you’ll likely want to consider:

  • Your current and expected tax rate
  • Increases in your income and savings rate
  • A contingency plan for unexpected events

However, retirement calculators can make the concept of retirement savings more concrete—and help you take action toward your goals.

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