A Quote by Benjamin Graham

The function of the margin of safety is, in essence, that of rendering unnecessary an accurate estimate of the future.

Benjamin Graham

Quote Topics

Accurate Essence Estimate Function Future Margin Rendering Safety Unnecessary

Quote Author

Benjamin Graham
American - Economist
May 8, 1894 - September 21, 1976

Edge also implies what Ben Graham....called a margin of safety. You have a margin of safety when you buy an asset at a price that is substantially less than its value. As Graham noted, the margin of safety 'is available for absorbing the effect of miscalculations or worse than average luck.' ...Graham expands, "The margin of safety is always dependent on the price paid. It will be large at one price, small at some higher price, nonexistent at some still higher price."

Michael Mauboussin

If you understood a business perfectly and the future of the business, you would need very little in the way of a margin of safety. So, the more vulnerable the business is, assuming you still want to invest in it, the larger margin of safety you'd need. If you're driving a truck across a bridge that says it holds 10,000 pounds and you've got a 9,800 pound vehicle, if the bridge is 6 inches above the crevice it covers, you may feel okay, but if it's over the Grand Canyon, you may feel you want a little larger margin of safety.

Warren Buffett

To have a true investment, there must be a true margin of safety. And a true margin of safety is one that can be demonstrated by figures, by persuasive reasoning, and by reference to a body of actual experience.

Benjamin Graham

If you understood a business perfectly and the future of the business, you need very little in the way of a margin of safety.

Warren Buffett

High leverage is unsafe, not just for a company but the entire economy... LBOs are reducing the safety. Management loses the power to do many things. It has no margin for error and less margin for additional risk.

Franco Modigliani

Bernanke and company are trying to reflate the economy with almost stated objective of inflation at 2 percent and higher in order to provide some type of safety margin for a future recession. That's where they want to go.

Bill Gross

No matter that astronauts and cosmonauts had perished in precisely designed and carefully tested machines. Solid engineering could always provide a safety margin, because the engineers believed, there was complete safety in numbers.

William E. Burrows

But we agree with the NTSB that if we eliminated the thrust- reverser calculation, it would be an extra margin of safety. Airport capacity and airline efficiency are important, but safety is the most important thing.

Laura Brown

Safety has been my top legislative priority. I'm driven by the idea that safety is really a core function of government.

Debbie Wasserman Schultz

Even with a margin of safety in the investor's favor, an individual security may work out badly. For the margin guarantees only that he has a better chance for profit than for loss - not that loss is impossible. But as the number of such commitments is increased the more certain does it become that the aggregate of the profits will exceed the aggregate of the losses.

Benjamin Graham

In engineering, people have a big margin of safety. But in the financial world, people don't give a damn about safety. They let it balloon and balloon and balloon. It's aided by false accounting.

Charlie Munger

Protect the downside. Worry about the margin of safety.

Peter Cundill

The three most important words in investing...Margin of Safety.

Warren Buffett

The essence of religion is inertia; the essence of science is change. It is the function of the one to preserve, it is the function of the other to improve. If, as in Egypt, they are firmly chained together, either science will advance, in which case the religion will be altered, or the religion will preserve its purity, and science will congeal.