Hadrien PUCHE

“It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.” – George Soros

by

Hadrien Puche

In financial markets, everyone wants to be right. The temptation to make accurate predictions, about earnings, interest rates, recessions, or stock prices, is universal. But as George Soros reminds us, accuracy alone is meaningless. What truly matters is how much you profit when you’re right, and how much you lose when you’re wrong.

This quote challenges one of the deepest misconceptions in trading: the belief that success depends on predicting the future. In reality, trading success mostly depends on risk management, position sizing, and the discipline to adjust when the market proves you wrong.

About George Soros

George Soros
Warren Buffett

Source: EU

George Soros (born in 1930) is a Hungarian-American investor and philanthropist. He founded Soros Fund Management, a global macro hedge fund known for making large, directional bets across currencies, bonds, equities, and commodities.

Soros became globally famous in 1992 when he “broke the Bank of England” by shorting the British pound, a trade widely reported to have earned over $1 billion.

The European Exchange Rate Mechanism (ERM) was created to stabilize European currencies ahead of the future monetary union by keeping exchange rates within narrow fluctuation bands. When the UK joined, it agreed to maintain the pound within this band, but entered at a rate that many considered overvalued.

Seeing this imbalance, George Soros spent months building a large short position against the pound. On “Black Wednesday” in 1992, the British government failed to defend the currency through interest-rate hikes and interventions, forcing a devaluation. Soros reportedly earned over $1 billion and became known as “the man who broke the Bank of England.”

Not all of Soros’s trades were successful. In 2016, he reportedly lost close to $1 billion after wrongly predicting that markets would fall following Donald Trump’s election.

Beyond trading, Soros developed the theory of reflexivity, which argues that markets are shaped by feedback loops between perceptions and fundamentals. His philosophy emphasizes uncertainty, adaptability, and the psychological drivers behind market behavior.

The context behind this Quote

This quote is not actually from Soros. It comes from Stanley Druckenmiller—Soros’s former chief strategist—in The New Market Wizards (1994). Druckenmiller explains that the most important lesson he learned from Soros was not the importance of being right, but of structuring trades so that being right pays off and being wrong costs little.

Book cover of the new market wizards

The quote therefore reflects Soros’s investment philosophy: markets cannot be predicted with certainty, so success depends more on managing risk than on forecasting.

This mindset is foundational to modern risk management and a key reason Soros is considered one of the most influential investors of the past century.

Analysis of the Quote

The quote captures three essential ideas:

  • asymmetric returns
  • risk management
  • intelligent position sizing

Being right doesn’t matter unless it pays. For example, even if you forecast Nvidia’s earnings perfectly, you may still fail to profit because:

  1. You may not have any position.
  2. Your position may be too small.
  3. The market may behave irrationally.
  4. Losses on other trades may outweigh this one win.

This is the essence of risk management: structuring positions so that winners meaningfully contribute to performance while losers remain contained.

Let’s introduce three key financial ideas that relate to this quote.

1. Diversification and Position Timing

Even if your analysis is correct, the market might not react as expected, or not at the right time. This is where the distinction between trading and investing matters.

Soros’s quote speaks the language of trading: position sizing, timing, and controlling downside on each bet.

Investing, by contrast, relies less on precise timing and more on diversification, which reduces exposure to unpredictable events and smooths returns across different regimes.

Mathematically, diversification lowers portfolio variance because asset returns are imperfectly correlated. Even when individual positions behave unpredictably, a well-constructed portfolio can achieve far better risk-adjusted results than any single trade. In that sense, diversification plays a similar role for investors as stop-losses and disciplined position sizing do for traders: it manages the impact of being wrong.

The following graph illustrates how adding more independent positions reduces overall portfolio risk.

A graph representing the overall risk of a portfolio as a function of the number of positions

2. Avoid cutting winners to reinforce losers

This behavioral trap affects most investors. Soros’s approach is the opposite:

  • cut losing positions quickly
  • let winners run

Yet, due to loss aversion (as formalized by Kahneman & Tversky (1979) in Prospect Theory), investors often do the reverse:

  • sell winners too early
  • hold losers too long

This pattern is well-documented in the literature. Shefrin & Statman (1985) termed it the disposition effect: the systematic tendency to “sell winners too early and ride losers too long.” The emotional discomfort of realizing a loss often outweighs the rational need to exit a bad position.

Momentum works partly for this reason. Rising prices attract reluctant investors who delayed selling their winners, amplifying trends; meanwhile, stubbornly held losers can drift downward for longer than fundamentals alone would justify.

3. Quantitative trading: the power of averaging out

Quantitative trading is built on making many small, systematic bets with a positive expected value. The goal is not to win every trade, but to win more (or bigger) on average.

This is the practical application of the idea that:

  • being right occasionally with large wins
    is more valuable than
  • being right frequently with small gains.

This also echoes Jesse Livermore’s famous line: “The market is never wrong, only opinions are.” (link)

My view on this quote

One limitation of Soros’s statement is that it implicitly assumes the reader is an active trader. In reality, today’s markets are dominated by algorithms, quantitative models, and high-frequency strategies, an environment in which most individuals are unlikely to outperform professional traders. For traders, Soros’s point is straightforward: you will often be wrong, so what matters is how you size positions and manage risk when you are.

At a literal level, the quote may also seem paradoxical: you cannot know in advance which trades will be winners or losers. But the message isn’t about prediction, it’s about discipline.

This distinction becomes especially clear when you contrast trading with investing.

  • Traders live in a world of short-term uncertainty and constant position adjustments, where the asymmetry between gains and losses determines survival.
  • Investors, on the other hand, think in years, not minutes. They rely less on timing and more on letting fundamentals and compounding work over time. For them, the “how much you lose when you’re wrong” part translates into diversification, staying invested, and avoiding irreversible mistakes rather than optimizing each individual decision.

Seen this way, Soros’s line applies to both groups, just at different scales: traders manage outcomes trade by trade; investors manage them across decades. Either way, the principle holds: success depends less on being right and more on controlling the cost of being wrong.

Why should you care about this quote ?

The lesson is not about predicting markets or mastering sophisticated position sizing. The deeper message is:

  • Don’t rely on being right.
  • Structure your trades so that mistakes are limited and successes compound.

A diversified ETF strategy naturally achieves this.
In cap-weighted indices:

  • winners grow in weight
  • losers shrink, limiting their impact
  • the portfolio trends with long-term market growth

This simple, robust approach aligns with Soros’s philosophy: control the downside, let the upside work.

Related Posts

Useful Resources

  • Soros, George (1987). The Alchemy of Finance. Soros explains reflexivity, asymmetry of payoff, and his macro-trading framework.
  • Schwager, Jack (1994). The New Market Wizards. Contains Stanley Druckenmiller’s interview where the famous quote originates.
  • The Disposition to Sell Winners Too Early and Ride Losers Too Long: Theory and Evidence — Hersh Shefrin & Meir Statman (Journal of Finance, 1985, 40(3), 777–790).
  • Kahneman, D., & Tversky, A. (1979). Prospect Theory: An Analysis of Decision under Risk. Econometrica, 47(2), 263–291.

To learn more about Soros’s famous 1992 British pound trade:

  • Eichengreen, Barry & Wyplosz, Charles (1993). “The Unstable EMS.” A leading academic analysis of why the European Exchange Rate Mechanism (ERM) became vulnerable and how the 1992 crisis unfolded.
  • Bank of England (1993). Report on the Withdrawal of Sterling from the ERM. Official institutional account of the events surrounding Black Wednesday.

About the Author

This article was written in December 2025 by Hadrien Puche (ESSEC, Grande École Program, Master in Management – 2023–2027).

“In investing, what is comfortable is rarely profitable.” – Robert Arnott

by

Hadrien PUCHE

In this article, Hadrien PUCHE (ESSEC Business School, Grande École Program, Master in Management, 2023-2027) comments on Robert Arnott’s famous quote, exploring how it relates to risk-taking, behavioral biases, and the mindset required to achieve consistent, long-term performance.

About Robert Arnott

Robert Arnott
Robert Arnott

Source: Research Affiliates

Robert D. Arnott (born 1954) is an American investor, researcher, and entrepreneur. He is the founder and chairman of Research Affiliates, a firm known for its pioneering work on smart beta and alternative indexing strategies. Arnott has written extensively on asset allocation, portfolio construction, and factor investing, often challenging traditional assumptions about market efficiency.

Throughout his career, Arnott has emphasized that the best investment opportunities emerge when investors are willing to leave their comfort zone, particularly when markets are volatile, sentiment is negative, and uncertainty dominates.

Analysis of the quote

When Arnott says, “In investing, what is comfortable is rarely profitable,” he highlights a fundamental paradox of financial markets: comfort and profit rarely coexist.

Comfort comes from stability, familiarity, and consensus. Yet, markets reward those who act rationally in uncomfortable moments; those who buy when others sell and remain calm when others panic. Profitable investing often requires doing what feels counterintuitive.

However, this quote does not promote reckless risk-taking. Instead, it reminds us that genuine investment opportunities often arise in periods of uncertainty and fear, when prices deviate from intrinsic value. Success lies in maintaining discipline and conviction when others lose theirs.

Moreover, this insight resonates with Frank Knight’s distinction between risk and uncertainty. While risk can be measured and priced, true uncertainty is unknowable and unpredictable. Investing in moments of discomfort often means confronting this unmeasurable uncertainty, and taking opportunities when most investors hesitate.

Case study: March 2020 – Investing during the Covid crisis

Between February and March 2020, the S&P 500 index fell by more than 30% as investors panicked and rushed to sell their holdings. However, those who bought stocks during the downturn (or even simply stayed invested) saw the market recover to new highs within just a few months. The real losses came not from the crash itself, but from panic selling at the worst possible moment.

To better understand why the market reaction was so violent during this period, it is useful to look at the VIX index, often referred to as the “fear gauge” of financial markets. The VIX measures expected volatility based on S&P 500 option pricing, and it tends to spike when uncertainty and investor anxiety rise.

In the graph below, which compares the performance of the S&P 500 and the VIX over the 2020 Covid market crash, we can clearly see how moments of market stress correspond to sharp increases in the VIX.

S&P500 and VIX index in 2020

The S&P 500 declines at the same time the VIX surges, illustrating the sharp rise in market fear and uncertainty.
Source: TradingView

Financial concepts related to the quote

I present below three financial concepts: the risk–return tradeoff, the psychology behind discomfort, and contrarian investing and market cycles.

The risk–return tradeoff

Arnott’s quote connects directly to the risk–return tradeoff, a cornerstone of modern portfolio theory (Harry Markowitz, 1952). The principle is simple but powerful: higher expected returns are only possible when investors accept higher levels of risk.

In quantitative terms, risk is often measured by metrics such as volatility (the standard deviation of returns) or the Value at Risk (the expected maximum loss that could occur on a given period). Assets with higher volatility tend to offer higher average returns to compensate investors for the uncertainty they bear.

This relationship is evident across asset classes: equities have historically outperformed bonds, and small-cap or emerging market stocks have outperformed large, stable firms, precisely because they are riskier and therefore less “comfortable” to hold.

Money Markets Bonds (20Y TB) Equities (S&P 500)
Historical returns 3.3% 5.7% 10.3%
Historical volatility 0.1 to 1% 10% 15 to 20%

These are the average historical returns and volatility of the main asset classes over the past century.
Source: “Long-Term Performance”, Martin Capital, and CFA Institute.

Those who prioritize comfort, by investing in stable, low-volatility assets such as government bonds or blue-chip stocks, may achieve safety but at the cost of limited upside. In contrast, investors willing to face volatility intelligently, through diversification, disciplined portfolio construction, and long-term perspective, can capture higher returns over time.

Ultimately, discomfort is not a flaw of investing, but rather the price of better returns. As every investor learns sooner or later, there is no reward without risk, and no performance without volatility.

This relationship between risk and return is often illustrated by the efficient frontier: as investors take on more risk (measured by the volatility of returns), the expected long-term return increases. The graph below shows this fundamental tradeoff, highlighting how low-risk assets typically offer modest returns, while higher-risk assets provide the potential for superior performance.

Graph of performance against risk

The psychology behind discomfort

Arnott’s insight aligns closely with behavioral finance, particularly Daniel Kahneman and Amos Tversky’s concept of loss aversion. The idea is that the pain of losing is psychologically about twice as powerful as the pleasure of gaining.

The chart below illustrates this asymmetry: while gains produce only a moderate rise in satisfaction, losses trigger a disproportionately strong emotional reaction, shaping many irrational investment decisions.

Losses hurt people more than gains make them feel good

This bias makes investors instinctively avoid risk, even when it offers potential rewards.

In financial markets, this aversion to loss often translates into herd behavior: investors seek comfort in doing what others do, buying overvalued assets during booms and selling undervalued ones during downturns. While this may feel safe in the short term, it systematically destroys value over time.

Legendary investors such as Warren Buffett and Howard Marks have long warned against this mindset: “Be fearful when others are greedy, and greedy when others are fearful.” True comfort in markets is often a sign of danger, not safety.

A good example is the dot-com bubble of 2000. At the time, investing in fast-growing tech stocks felt like the comfortable and obvious choice, as prices seemed to rise endlessly. Yet when the bubble burst, it became clear that this comfort had been an illusion, and that discomfort, not consensus, is where opportunity truly lies.

Contrarian investing and market cycles

Arnott’s quote also resonates with the philosophy of contrarian investing: the art of going against prevailing market sentiment. It means buying when fear dominates and selling when euphoria prevails.

As Minsky explains in his Financial Instability Hypothesis, periods of stability paradoxically encourage increasing risk-taking, as market participants move from hedge finance to speculative and then Ponzi finance. This endogenous dynamic inevitably leads to points of fragility where confidence collapses. Kindleberger, in Manias, Panics, and Crashes, provides empirical illustration: markets swing from euphoria to distress, from boom to bust, before stability gradually returns and the cycle begins anew.

The chart below visually maps this emotional cycle, highlighting how investor psychology typically evolves from euphoria to panic and back to optimism.

Market emotions cycles graph

The most profitable opportunities often emerge during moments of maximum discomfort: recessions, crises, or market panics, when prices are depressed but fundamentals remain sound. As Sir John Templeton famously said, “The time of maximum pessimism is the best time to buy.”

However, acting against the crowd is far from easy. It requires not only analytical conviction but also emotional discipline, the ability to stay rational when everyone else reacts emotionally. This mental resilience is what separates long-term investors from speculators driven by short-term noise.

My opinion about this quote

I find Arnott’s statement particularly relevant, at a time when social media and short-term performance metrics dominate investor psychology. Platforms such as X (Twitter), Reddit, or TikTok amplify herd behavior by rewarding consensual views rather than conviction. True investment success requires patience, analytical thinking, and the ability to tolerate discomfort.

To me, this quote extends beyond finance: it reflects a mindset of resilience and independence, valuable in career decisions, entrepreneurship, and life in general, because growth rarely happens in comfort zones.

Why should you be interested in this post?

This quote provides a timeless reminder for students and young professionals: comfort is the enemy of progress.

The rise of AI-driven trading, quantitative strategies, and passive investing has made markets appear more predictable and automated. This can create new forms of comfort, a belief that algorithms or index funds can replace human judgment. However, Arnott’s message reminds us that critical thinking, curiosity are still needed to outperform others.

As Arnott’s principle suggests, growth rarely happens in comfort zones. Whether in markets, careers, or personal development, long-term success comes from embracing uncertainty intelligently, and finding opportunity where others see discomfort.

Related posts on the SimTrade blog

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   ▶ Youssef LOURAOUI Asset allocation techniques

   ▶ Youssef LOURAOUI Smart Beta strategies: between active and passive allocation

   ▶ Youssef LOURAOUI Markowitz Modern Portfolio Theory

Useful Resources

Business Books

Graham, B. (1949). The Intelligent Investor: A Book of Practical Counsel (Rev. ed.). Harper & Brothers.

Academic Articles

Arnott, R. D. (2003). The Fundamental Index: A Better Way to Invest. Financial Analysts Journal, 59.

Arnott, R. D. (2005). The Most Dangerous Equation. Financial Analysts Journal, 61.

Kahneman, D., & Tversky, A. (1979). Prospect Theory: An Analysis of Decision under Risk. Econometrica, 47(2), 263–291.

Markowitz, H. (1952). Portfolio Selection. The Journal of Finance(1), 7:77–91.

Classic Economic & Finance Works

Kindleberger, C. P. (1978). Manias, Panics, and Crashes: A History of Financial Crises. New York: Basic Books.

Minsky, H. P. (1992). The Financial Instability Hypothesis. Working Paper No. 74, Jerome Levy Economics Institute.

About the Author

This article was written in November 2025 by Hadrien PUCHE (ESSEC, Grande École Program, Master in Management – 2023–2027).

“Most people overestimate what they can do in a year and underestimate what they can do in ten.” – Bill Gates

by

Hadrien Puche

In a world that often focuses on immediate results and instant gratification, it can be easy to overlook how regular effort accumulates into long-term impact.

This quote by Bill Gates reminds us that human ambition and effort are most effectively realized over extended periods of time. Planning ahead, embracing patience, and committing to consistent action are the keys to achieving extraordinary outcomes.

In this article, Hadrien Puche (ESSEC, Grande École, Master in Management, 2023 to 2027) reflects on this quote, exploring how it applies not only to personal growth but also to finance, and especially investing.

About Bill Gates

Bill Gates
Bill Gates

Source: Wikimedia Commons

Bill Gates is a co-founder of Microsoft and one of the most influential entrepreneurs of the late twentieth and early twenty-first century. Beyond his contributions to technology, he is widely recognized for his philanthropy through the Bill and Melinda Gates Foundation, which focuses on global health, education, and poverty reduction. Gates has often spoken about vision, long-term planning, and the accumulation of effort over time.

The quote, “Most people overestimate what they can do in a year and underestimate what they can do in ten,” is widely attributed to Bill Gates, although its true authorship is uncertain. What matters, however, is that Gates has consistently demonstrated through his work in technology and philanthropy how sustained effort and strategic planning can produce results that far exceed initial expectations.

Analysis of the quote

The central insight of this quote is that time magnifies effort. People often approach challenges with a short-term mindset, setting goals that are ambitious for a short period but fail to consider the compounding effect of consistent action. This makes them unable to reach these goals, leading to potential failure, whereas small steps over ten years can accumulate to produce extraordinary results.

This bias toward short-term thinking is prevalent in many areas of life, from career planning to investing. Individuals overestimate what they can accomplish quickly, which can lead to frustration when immediate goals are not met. Simultaneously, they underestimate what can be achieved over a decade, missing opportunities for growth, learning, and accumulation of value.

In finance, this mindset manifests in impatience with investments or ventures that require time to mature. In personal development, it is reflected in the failure to adopt habits that pay dividends over the long term. Gates’ quote is a reminder that extraordinary achievements are rarely the product of sudden effort. They are the result of consistent, incremental progress compounded over years.

This idea of long-term, incremental effort resonates closely with Malcolm Gladwell’s The Tipping Point: How Little Things Can Make a Big Difference. Gladwell explains how small, consistent actions or seemingly minor events can accumulate over time until they trigger a dramatic, outsized effect: the “tipping point.”

Economic and financial concepts related to the quote

I present below three financial concepts: compound interest, investment horizons, strategic planning and time diversification.

Compound interest

The concept of compound interest is perhaps the most direct financial parallel to Gates’ insight. In investing, the growth of wealth is not linear: returns earned on investments generate additional returns over time, producing an exponential effect. Individuals who understand and leverage compound interest can turn modest contributions into significant wealth over decades, whereas those who focus on immediate gains often miss the cumulative benefits. Gates’ quote captures this principle in human effort and strategic planning, emphasizing that patience and consistency are more powerful than short bursts of activity.

This is why Einstein famously called compound interest the “eighth wonder of the world.”

A graph showing the difference between simple and compounded interest

This graph shows how investing €1,000 over 30 years leads to exponential growth through compounding.

To better understand compounding, download this excel file and try to play around with the interest rate.

Download the Excel file to learn more about how compounding works

Investment horizons

Successful investing often relies on a long-term perspective. Markets can be volatile in the short term, but sustained investment in fundamentally sound assets typically produces growth over extended periods. Investors who overreact to short-term fluctuations may underperform by frequently buying and selling, while those who commit to a long-term strategy benefit from the power of time. Gates’ insight mirrors this approach.

From a financial standpoint, this is also a question of μ vs σ: in the short run, market movements are dominated by σ (sigma; volatility), which makes returns unpredictable and often discouraging. But over longer horizons, μ (mu; the average expected return) becomes more visible, and the noise of volatility fades relative to the trend. In other words, the longer you stay invested, the more likely the underlying growth of the market (and not short-term fluctuations) will determine your outcome.

A graph of the S&P 500 index since 1900

As you can see on this graph, the S&P 500 index tends to perform well on the long run and always recover from times of crisis.

Just as how small investments compound over many years, consistent effort in personal or professional life produces results far greater than what is visible in a single year.

Strategic planning and time diversification

In economics and business, strategic planning means looking beyond immediate gains and considering how decisions will play out over multiple years or even decades. Investments in areas such as research and development, employee training, or infrastructure rarely pay off right away. Yet, as these efforts accumulate, they can create lasting competitive advantages, foster innovation, and drive long-term profitability.

A similar logic applies in finance through time diversification. Short-term market fluctuations can be unpredictable, but the longer an investor stays committed to a well-constructed portfolio, the greater the chance that temporary volatility smooths out and long-term growth prevails.

Gates’ quote captures the essence of both ideas: meaningful results (in business, investing, or personal development) come not from quick wins but from sustained effort and the willingness to think further ahead than the next quarter or the next year.

My opinion about this quote

This quote feels especially relevant today, as the pace of technological change accelerates with the rise of artificial intelligence and other innovations. Society is not accustomed to this level of speed, which can distort our perception of what is achievable. While there is a temptation to believe that technological advances will produce massive change within just a few years, Gates’ quote reminds us to temper optimism with realistic expectations. In reality, it often takes considerable time for firms to integrate new technologies and realize meaningful productivity gains, as seen with the adoption of the internet and, more recently, with AI.

This dynamic is clearly illustrated in the graph below, known as the Gartner Hype Cycle. This framework describes the typical pattern of expectations surrounding new technologies. When a breakthrough such as generative AI emerges, public enthusiasm and media attention often inflate expectations far beyond what is achievable in the short term. As a result, we tend to overestimate the immediate impact of the innovation.

However, as the technology progresses through the different phases of the cycle (from initial excitement to disillusionment, and eventually to maturity), its long-term transformative potential becomes clearer. The Gartner Hype Cycle helps explain why we so often underestimate what a technology can achieve over a decade, even while exaggerating what it can achieve in its first year.

A graph of the Gartner Curve

The Gartner Hype Cycle, illustrating the typical progression of expectations around new technologies (Source: Gartner).

At the same time, the quote encourages reflection on long-term potential. Even if technologies develop more slowly than expected, incremental improvements over a decade can still lead to transformative outcomes. The lesson is to maintain both patience and vigilance, avoiding the extremes of overconfidence or neglect.

This principle also applies to personal finance and life planning. Many people set short-term goals and become frustrated when progress seems slow. Yet, the cumulative effect of consistent action, thoughtful saving, learning, or skill development often surpasses what we anticipate in the first year. By recognizing the value of long-term effort, individuals can better allocate resources, set meaningful goals, and make decisions that pay off over time.

In professional contexts, such as career progression or entrepreneurship, the quote is equally valuable. Building a company, developing expertise, or pursuing innovation rarely produces instant results. Sustained effort, compounded knowledge, and consistent decision-making are what lead to exceptional achievements over the long term.

Why should you be interested in this post?

Bill Gates’ quote is a reminder to plan thoughtfully, embrace patience, and recognize the exponential power of effort. While no one can predict the future with certainty, adopting a long-term perspective allows individuals to maximize the impact of their actions and investments.

This insight is particularly relevant for students and young professionals. You do not need a detailed plan for the next ten years, but considering the direction of your efforts and making incremental progress can dramatically improve outcomes over time. Recognizing the gap between short-term overestimation and long-term underestimation fosters discipline, focus, and resilience in both personal and financial decisions.

Whether applied to investing, professional development, or personal goals, this quote encourages a mindset that values consistency, foresight, and the compounding power of effort. Understanding this principle allows individuals to avoid the pitfalls of impatience while harnessing the opportunities presented by sustained dedication.

Related posts

   ▶ All posts about Quotes

Useful resources

– The Tipping Point: How Little Things Can Make a Big Difference by Malcolm Gladwell

About the Author

This article was written in 2025 by Hadrien Puche (ESSEC, Grande École, Master in Management 2023 to 2027)

“The market is never wrong, only opinions are“ – Jesse Livermore

by

Hadrien PUCHE

In this article, Hadrien PUCHE (ESSEC Business School, Grande École Program, Master in Management, 2023-2027) comments on Jesse Livermore’s timeless quote and explores its relevance for modern investors and students seeking to understand market psychology.

About Jesse Livermore

Jesse Livermore (1877–1940) was one of Wall Street’s first great speculators, a man who understood the rhythm of markets long before data screens and algorithms existed. He made and lost several fortunes, most famously by shorting stocks ahead of the Panic of 1907 and the Great Depression of 1929.

Livermore’s life was both brilliant and tragic, but his insights into crowd behavior and emotional discipline remain essential reading for anyone who wishes to understand how markets truly work.

Jesse Livermore
Jesse Livermore

Analysis of the quote

“The market is never wrong, only opinions are.” – Jesse Livermore

When Livermore says, “The market is never wrong, only opinions are,” he reminds us that prices are not moral judgments or forecasts of truth — they are the product of human behavior under uncertainty.

Markets do not care about fairness or logic. They reflect the collective sum of all opinions, weighted by money. To claim that “the market is wrong” is to claim that your personal view outweighs the collective intelligence and capital of millions of other participants.

That rarely ends well. The market may sometimes overreact, but it is almost always the individual who misunderstands its message.

This quote, in the end, is a lesson in humility. Investors lose not because they lack intelligence, but because they refuse to admit when the market has proven them wrong.

Economic and financial concepts related to the quote

1 – Market efficiency

Livermore’s idea anticipates the theory of market efficiency introduced many decades later by Eugene Fama in 1970. This theory suggests that prices incorporate all available information, which means it is almost impossible to consistently beat the market.

Even if markets are not perfectly efficient, they are highly competitive ecosystems. Information spreads very quickly, and any mispricing is soon corrected by professionals equipped with technology and capital.

So when you decide that the market is wrong, you are effectively betting that your insight is sharper than everyone else’s, from hedge funds to central banks. Occasionally, some investors do have that edge, but they are the exception, not the rule.

2 – The Wisdom and the Madness of Crowds

In The Wisdom of Crowds (2004), James Surowiecki argues that large groups can make remarkably accurate collective judgments, even when individual members are biased or imperfectly informed. Financial markets often exemplify this phenomenon: while single investors are prone to emotion and error, the aggregation of their independent views can produce a consensus that efficiently reflects available information.

Yet, Surowiecki also cautions that collective intelligence breaks down when independence disappears. In markets, this occurs when participants are driven by shared emotions: panic during crashes or euphoria during bubbles. At such moments, the “wisdom” of the crowd can turn to madness.

3 – Risk management and flexibility

Livermore’s warning remains as relevant as ever: never fight the market. Every investor is wrong sometimes, but what matters is how quickly you realize it and act. The real danger isn’t being wrong, it’s refusing to admit it. Livermore’s rule captures this perfectly: “Cut your losses short and let your winners run.”

Good risk management starts there. It means knowing how much you can afford to lose, setting a stop-loss before entering a trade, and sticking to it. A stop-loss isn’t a sign of weakness, it’s a protection. It prevents small mistakes from turning into big ones and keeps you in the game for the long run.

As Keynes famously said, “Markets can stay irrational longer than you can stay solvent.” Managing risk isn’t about predicting the market, it’s about surviving it.

My opinion about this quote

Livermore’s insight feels even more relevant in today’s world of instant information and algorithmic trading. Social media multiplies opinions at unprecedented speed, creating noise that can easily obscure reality.

Recent market episodes illustrate this perfectly. In 2021, for example, the GameStop saga showed how collective emotion on Reddit briefly overwhelmed fundamental analysis, sending the stock to irrational highs before gravity reasserted itself.

Similarly, during the cryptocurrency boom of 2021 and 2022, investors often claimed that “this time is different,” only to face sharp corrections when enthusiasm faded.

Closer to home, the Atos case in 2024 reflected the same dynamic. Despite the company’s severe financial distress and an announced dilution that effectively made the stock almost worthless, waves of speculative buying pushed its valuation to absurd levels for a few days. When reality returned, the correction was brutal.

Atos stock price chart

These examples confirm Livermore’s message: opinions can be wrong for a long time, but the market always has the final word.

Why should you be interested in this post?

For students and young professionals, Livermore’s lesson is a call for intellectual humility. Markets are complex and adaptive systems, impossible to predict with precision but possible to understand with patience.

Learning to separate your opinions from what the market is telling you will make you a better analyst, investor, and decision-maker. It will also help you develop emotional intelligence, a skill far rarer than technical knowledge.

In finance, as in life, the goal is not to be right, it is to adapt faster when you are wrong.

Related posts on the SimTrade blog

   ▶ All posts about Quotes

Useful resources

Reminiscences of a Stock Operator – Edwin Lefèvre (1923)

The Efficient Market Hypothesis and Its Critics – Burton Malkiel (2003)

Thinking, Fast and Slow – Daniel Kahneman (2011)

SimTrade course Market information

Academic research

Fama E. (1970) Efficient Capital Markets: A Review of Theory and Empirical Work, Journal of Finance, 25, 383–417.

Fama E. (1991) Efficient Capital Markets: II, Journal of Finance, 46, 1575–617.

Grossman S.J. and J.E. Stiglitz (1980) On the Impossibility of Informationally Efficient Markets, The American Economic Review, 70, 393–408.

Chicago Booth Review (30/06/2016) Are markets efficient? Debate between Eugene Fama and Richard Thaler (YouTube video)

About the author

This article was written in November 2025 by Hadrien PUCHE (ESSEC, Grande École Program, Master in Management – 2023–2027).

“Don’t look for the needle in the haystack. Just buy the haystack.“ – John Bogle

by

Hadrien PUCHEOver the past decade, investing has become more accessible than ever. Anyone with a smartphone can now buy or sell shares, cryptocurrencies, or ETFs within seconds. While this democratization of finance has clear benefits, it has also led many to lose money by chasing “the next big stock.” Retail investors often believe they can find the next Tesla or Nvidia: the famous “needle in the haystack.” Yet, as history repeatedly shows, only a small fraction succeed.

That is precisely what John C. Bogle, the founder of Vanguard and the father of index investing, warned against. His advice was simple yet profound: stop trying to find the needle, just buy the entire haystack.

In this article, Hadrien PUCHE (ESSEC Business School, Grande École Program, Master in Management, 2023-2027) comments on Bogle’s timeless quote, exploring how it captures one of the most important principles in modern investing: diversification.

About John C. Bogle

John Clifton Bogle (1929 – 2019) was an American investor and philanthropist best known as the founder of The Vanguard Group, one of the world’s largest asset management firms. In 1976, Bogle created the first index fund available to individual investors, the Vanguard 500 Index Fund, designed to replicate the performance of the S&P 500 index rather than beat it.

At the time, his idea was revolutionary. The prevailing belief was that skilled managers could consistently outperform the market through superior stock selection and market timing. Bogle argued the opposite: after accounting for management fees, transaction costs, and human error, most active managers fail to beat the market over the long term. His philosophy emphasized simplicity, discipline, and cost-efficiency, principles that now underpin the $12 trillion global index fund industry.

John C. Bogle
John Bogle

Analysis of the quote

Bogle’s quote encapsulates a powerful truth: successful investing does not require finding hidden gems, but rather owning the market as a whole. The “needle in the haystack” represents the elusive high-performing stock every investor dreams of. Yet statistically, most attempts to find it fail. By buying the entire “haystack” (that is, the full market) investors automatically own all the winners and minimize the risk of missing them.

Empirical research overwhelmingly supports this idea. Over time, a small number of stocks account for the majority of total market gains. A study by Hendrik Bessembinder (2018) found that, since 1926, just 4% of U.S. stocks generated the entire net wealth created by the stock market. Most others either underperformed or disappeared entirely. Thus, identifying the few long-term winners ex ante is nearly impossible. The rational solution is to own the entire market, a strategy that index funds make accessible and affordable.

Bogle’s insight also reflects humility: acknowledging that even professionals struggle to outperform broad market indexes. By accepting this, investors shift their focus from beating the market to participating in its long-term growth.

Financial concepts related to the quote

I present below three fiancial concepts: diversification, index funds, and the efficient portfolio frontier.

Diversification

Diversification is the cornerstone of modern portfolio theory. It refers to spreading investments across different assets or sectors to reduce risk. By owning a broad range of companies, an investor limits the impact of any single firm’s poor performance.

Bogle’s philosophy embodies this principle. Buying the entire market, through an index fund tracking, for example, the S&P 500 or the CAC 40, ensures exposure to hundreds of firms across multiple sectors. The failure of one or two is offset by the success of others.

In practice, diversification improves a portfolio’s risk-adjusted return. It does not eliminate risk entirely but reduces idiosyncratic risk (the risk specific to individual companies). What remains is systematic risk, which affects the entire market and cannot be diversified away. This relationship is evident when observing how portfolio risk declines as the number of securities increases.

Risk of a portfolio as a function of the number of assets

Index funds

Index funds are collective investment vehicles that aim to replicate the performance of a specific market index, such as the S&P 500 (U.S.), the MSCI World (Global), or the CAC 40 (France). They hold the same securities as the index, in the same proportions, ensuring the fund’s return closely matches that of the benchmark. Because they are passively managed, index funds have very low management fees (often 10 to 20 times cheaper than traditional mutual funds). They also provide instant diversification: by buying one share of an S&P 500 ETF, you effectively invest in 500 companies.

This simplicity explains their rapid growth. According to Morningstar, index funds and ETFs now represent more than 50% of all U.S. equity fund assets. Their accessibility and transparency have fundamentally reshaped global investing.

However, one subtle limitation is that most major indexes are market-cap weighted, meaning the largest companies exert the greatest influence. As of 2025, the “Magnificent 7” (Tesla, Nvidia, Apple, Microsoft, Alphabet, Meta, and Amazon) represent nearly 35% of the index’s total value. The chart below illustrates their growing share of total market capitalization over time, highlighting how even “diversified” investors are increasingly concentrated in a handful of mega-cap technology firms.

Market capitalization of the Magnificent 7 as a share of index total

The efficient portfolio frontier

Introduced by Harry Markowitz in 1952, the efficient frontier illustrates the optimal trade-off between risk and (expected) return for a diversified portfolio. Each point on the curve represents the best possible expected return for a given level of risk.

Efficient frontier graph

Index investing often lies near this efficient frontier. Because broad indexes like the S&P 500 already aggregate thousands of investors’ information and preferences, they effectively represent a “market portfolio” close to the optimal mix. Passive investors benefit from this efficiency without needing to forecast which assets will outperform.

Understanding the efficient frontier also reveals why chasing high returns through concentrated bets is dangerous. While such strategies may yield spectacular results occasionally, they almost always involve disproportionate risk.

My opinion about this quote

I believe this quote perfectly captures the essence of modern investing: simplicity often outperforms sophistication. Many individuals (and professionals) spend enormous time and money trying to beat the market, often with limited success. The SPIVA (S&P Indices Versus Active) report consistently shows that the majority of actively managed funds underperform their benchmark indexes over the long term. As of 2024, for instance, more than 85% of U.S. equity funds lagged the S&P 500 over a 10-year period.

The chart below illustrates this trend across different investment horizons, showing that the longer the time frame, the harder it becomes for active managers to outperform their benchmarks.

Most US equities fund managers fail at outperforming the S&P500 index

The reasons are clear: high management fees, excessive trading, and the psychological pressure to deliver short-term results. Fund managers often prioritize annual bonuses over long-term compounding, leading to decisions driven by incentives rather than rational analysis.

At the same time, Bogle’s approach is not entirely without nuance. Index funds may appear perfectly diversified, but as noted earlier, their concentration risk has increased with the rise of mega-cap tech firms. Buying “the market” today means owning a portfolio dominated by a handful of giants. That, too, is an investment choice, one that has worked well recently but may not always hold true.

Therefore, the essence of Bogle’s wisdom is not that index investing is flawless, but that it is rational. It reflects humility, an understanding that long-term success comes not from prediction, but from participation, discipline, and patience.

Why should you be interested in this post?

For students and young professionals, this quote offers two critical lessons.

First, from a personal investing perspective, it highlights the power of simplicity. Investing through low-cost index funds allows anyone, regardless of expertise, to participate in long-term market growth without the stress of constant stock-picking. It is a proven strategy for building wealth steadily over time.

Second, from a professional standpoint, understanding how and why index funds dominate modern markets is essential. Whether you aim to work in asset management, corporate finance, or risk consulting, you must grasp how passive investing shapes market dynamics, liquidity, and valuation.

Ultimately, Bogle’s message goes beyond finance. It teaches intellectual humility: the recognition that long-term discipline often triumphs over short-term brilliance.

Related posts on the SimTrade blog

   ▶ All posts about Quotes

Useful resources

Vanguard official website

Bessembinder, H. (2018). Do Stocks Outperform Treasury Bills? Journal of Financial Economics.

SPIVA U.S. Scorecard (2024)

Markowitz, H. (1952). Portfolio Selection. Journal of Finance.

Bogle, J. C. (2017). The Little Book of Common Sense Investing.

About the Author

The article was written in November 2025 by Hadrien PUCHE (ESSEC Business School, Grande École Program, Master in Management, 2023-2027).

“Remember that time is money“ – Benjamin Franklin

by
Hadrien PUCHE

Turning one euro into a billion euros is the simplest thing in the world. All you need is one euro – and a nearly infinite amount of time.

In this article, Hadrien PUCHE (ESSEC Business School, Grande École Program, Master in Management, 2023-2027) comments on Benjamin Franklin’s famous quote and explores why treating time as both a scarce resource and a wealth multiplier can radically improve your productivity, your mindset, and your financial outcomes.

About Benjamin Franklin

Benjamin Franklin (1706-1790) was one of the founding fathers of the United States. Beyond politics, he was also a scientist, inventor, writer, and, more relevantly here, an economist.

Benjamin Franklin
Portrait Benjamin Franklin by Joseph Siffrein Duplessis
Source: portrait by Joseph Siffrein Duplessis

About the quote

The aphorism ‘Time is money’ comes from his 1748 essay Advice to a Young Tradesman. In it, Franklin advises working men to use their hours wisely in order to maximize the productivity of their labor. Remarkably, this 18th century advice remains more relevant than ever in the modern age of finance and personal efficiency.

Another modern interpretation relates to financial investments: the more time you leave capital to grow via interest, the higher its accumulated value. Time literally multiplies money through compounding.

To my Friend A. B.
As you have desired it of me, I write the following Hints, which have been of Service to me, and may, if observed, be so to you.
Remember that Time is Money. He that can earn Ten Shillings a Day by his Labour, and goes abroad, or sits idle one half of that Day, tho’ he spends but Sixpence during his Diversion or Idleness, ought not to reckon That the only Expence; he has really spent or rather thrown away Five Shillings besides.

Analysis of the quote

Franklin’s phrase can be interpreted on several levels. Fundamentally, it highlights that time is a limited resource and money is a stored form of that time. Think of money as a stock, and time as the flow that feeds it.

Every euro you earn is, in essence, a small unit of your time and effort converted into a convenient medium of exchange. You trade your own work hours for money, and later spend this money to buy someone else’s time and effort — the chef who prepared your lunch or the engineer who built your car.

While you can always earn back money, you can never regain lost time. Time is therefore much scarcer, and ultimately more valuable. Treating it with the same discipline as any limited resource can transform the way you approach productivity, work, and value creation.

You should also aim at buying back your time whenever possible. Whether through automation, delegation, or investing, let your capital work for you and use the proceeds to buy back your own time. In the end, true wealth is measured by how much time you can recover.

Economic and financial concepts related to this quote

The time value of money

The time value of money (TVM) is one of the most important concepts in finance: a euro today is worth more than a euro tomorrow.

Reasons:

  • People are risk averse and prefer present consumption over future consumption.
  • Inflation erodes purchasing power over time.
  • Money today can be invested to earn interest.

If you lend 100 euros today and only get back 100 euros next year, you’ve lost value. Lenders charge interest to compensate, even before accounting for default risk. This principle underpins most of modern finance.

The formula below gives the relation between the present value (PV) and the future value (FV).

Formula to link PV (Present Value) and FV (Future Value)
Formula to link PV (Present Value) and FV (Future Value)

where r is the discount or compounding rate and 𝑡 t is time.

The opportunity cost

Opportunity cost reminds us that inaction carries a cost. By not investing your time or capital, you miss potential returns.

Example: €1,000 idle in a bank account for one year:

  • Lend it at 5% and earn €50.
  • Do nothing and earn €0.

The opportunity cost is €50. This principle extends beyond finance: career, education, or hobbies — always evaluate what you forgo by not choosing the alternative.

Discounting and compounding

Money grows over time through compounding, and its future value can be discounted to present value. These mechanisms allow investors to determine how much a future cash flow is worth today.

Compounding: earnings generate additional earnings over time, as interest accrues on interest. The longer the investment, the faster growth accelerates.

Example: €10,000 invested at 7% annually yields:

  • €19,671 after 10 years
  • €76,123 after 30 years
  • €294,570 after 50 years

Discounting: brings future sums back to present value, reflecting that a euro today is worth more than a euro tomorrow.

Together, compounding and discounting illustrate the fundamental relationship between time and value: time itself can create, or erode, wealth (when we consider the future or the present).

The figure below represents the impact of time on the value of an investment with simple and compound interests.

Graph showing how compounded interest works
Source : The author

You can download the Excel below to study the impact of time on money.

Download the Excel file to learn more about simple and compound interests

My opinion about this quote

This quote is especially relevant today — many forget that just as time is money, money is also time. We exchange time for money and spend money to access others’ time, often without reflection.

Example: buying a risotto at a restaurant — you pay not only for the food, but for the time of the chef, farmer, and delivery staff, who contributed hours of their lives for your convenience.

Franklin also reminds us of productivity: in many professions, including finance, people work long hours with diminishing returns. Working more isn’t the same as working efficiently; the challenge is maximizing value per unit of time.

Why should you be interested in this post?

Understanding the dual nature of time (scarce resource and wealth multiplier) is key for personal, professional, and financial success.

Whether investing, studying finance, building a business, or learning a skill, remember: every hour counts and starting early amplifies returns.

  • Allocate your time wisely.
  • Invest your time strategically.
  • Let both your time and capital work for you.

Related posts on the SimTrade blog

   ▶ All posts about Quotes

   ▶ How to compute the present value of an asset

   ▶ Understanding discount rate : a key concept in finance

Useful resources

Benjamin Franklin (1748) Advice to a Young Tradesman.

Morgan Housel (2020) The Psychology of Money.

Aswath Damodaran Time Value of Money (Aswath Damodaran) NYU Stern – Foundations of Finance Course.

About the Author

This article was written in October 2025 by Hadrien PUCHE (ESSEC Business School, Grande École Program, Master in Management – 2023-2027).

“Price is what you pay, value is what you get“ – Warren Buffett

by
Hadrien PUCHE

In this article, Hadrien PUCHE (ESSEC Business School, Grande École Program, Master in Management, 2023-2027) comments on Warren Buffett’s famous quote about the fundamental difference between price and value, and discusses how this distinction remains crucial for modern investors navigating today’s volatile markets.

About Warren Buffett

Warren Buffett is the chairman and CEO of Berkshire Hathaway, a financial holding company. He is widely considered one of the most successful long-term investors in history, known for his value-driven approach. Buffett often praised patience and a deep understanding of the intrinsic value of companies over speculation and short-term trends.

Warren Buffett
Warren Buffett
Source: Wikimedia Commons

About the quote

This quote, “price is what you pay, value is what you get”, is often attributed to Warren Buffett and is sometimes said to originate from one of his 1987 shareholder letters. However, its first verifiable appearance is in his 2008 shareholder letter, where Buffett uses it to emphasize the timeless lesson he learned from Benjamin Graham. The quote perfectly captures the essence of value investing, the philosophy that made Buffett so successful.

“Additionally, the market value of the bonds and stocks that we continue to hold suffered a significant decline along with the general market. This does not bother Charlie and me. Indeed, we enjoy such price declines if we have funds available to increase our positions. Long ago, Ben Graham taught me that ‘Price is what you pay; value is what you get.’ Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.”
(Warren E. Buffett, Berkshire Hathaway Shareholder Letter, 2008)

Analysis of the quote

Buffett’s quote highlights a key idea in both economics and finance: the difference between the price of an asset and its actual value.

The price is simply what you pay in a transaction, reflecting a market consensus at a specific moment in time. The value, however, is the abstract idea of the true worth of an asset, based on its capacity to generate future cash flows for its owner.

Buffett points out that market movements are largely shaped by human behavior, especially fear and greed, which can cause assets to be mispriced. The essence of long-term investing lies in identifying these inefficiencies and using them to build wealth over time.

Benjamin Graham, Buffett’s mentor, often illustrated this idea with the allegory of Mr. Market: a moody business partner who offers to buy or sell his stake in your company at changing prices every day. Sometimes he’s euphoric and offers too much, sometimes he’s depressed and offers too little. A wise investor listens politely, but never lets Mr. Market influence his view of the company.

Financial concepts related to the quote

We can relate this quote to three financial concepts: Intrinsic value, Efficient Market Hypothesis, and Market cycles.

Intrinsic value

The concept of intrinsic value suggests that any item can be given a “true worth”, based on its fundamentals: profits, growth, and overall future cash flows.

Models like the Discounted Cash Flow (DCF) analysis help investors estimate this value, by projecting how much cash an asset will generate and discounting it back to today’s money. Cash flows represent the real money a business produces — not just accounting profits, but the actual funds available to reinvest, repay debt, or distribute to shareholders.

The formula for the present value (PV) of a series of cash flows, denoted by CFt, discounted with the discount rate r, is given by:

Present value of a series of cash flows

The discount rate reflects both the time value of money — the idea that a euro today is worth more than a euro tomorrow, and the risk attached to the investment. The riskier the cash flows, the higher the discount rate investors will apply, and therefore the lower the intrinsic value. Understanding both the amount and the uncertainty of future cash flows is essential to determining what a company is truly worth.

Buffett’s philosophy is simple: always make investment decisions when you understand the intrinsic value and are therefore able to make informed and rational choices.

Efficient Market Hypothesis

According to the Efficient Market Hypothesis (EMH), formalized by Eugene Fama in 1970, asset prices in perfectly competitive markets instantly reflect all available information, implying that price always equals value.

However, value investing strongly challenges this idea. Markets often misprice assets, at least temporarily. Behavioral biases such as overconfidence, herd behavior or the tranquility paradox (a behavioral bias where prolonged stability increases risk-taking) can lead market prices to diverge from fundamentals, allowing some investors to buy undervalued assets and achieve superior long-term returns.

Market cycles

It is often believed that market prices move in cycles, driven by alternating periods of optimism and pessimism. When prices increase, investors are more optimistic and keep buying, pushing prices even higher. When prices start decreasing, investors start selling. All of this often happens without any major changes in the intrinsic value of the underlying companies.

Understanding these cycles may allow investors to act counter-cyclically: to buy when others are afraid and sell when they are greedy. Recognizing the difference between market emotion and fundamental value is what separates value investors from speculators.

My opinion about this quote

I believe that this quote is often forgotten by many investors. With the democratization of trading apps and financial content on social media, anyone can trade, but not many understand what they are doing.

I find value investing particularly challenging in today’s market. Take Nvidia as an example: as of 2025, the company is a global leader in graphics processing units (GPUs) and AI computing. With a Price-to-Earnings ratio around 51, can its intrinsic value truly justify a $4 trillion market capitalization? Perhaps, if you believe that the AI ecosystem will sustain the massive profits investors currently expect, but there is no doubt that the stock is currently expensive.

P/E ratio comparison of Nvidia, Amazon, Microsoft, Apple, Google

The challenge of identifying true value is not new : a historical parallel can be drawn with the dot-com bubble of the late 1990s, when companies with minimal earnings, like pets.com and America Online, saw sky-high valuations, that perhaps were disconnected from their actual values. Such episodes should remind investors of the importance of nuancing enthusiasm with careful analysis.

Graph of the cyclically adjusted P/E ratio of the SP500, from 1930 to today

The point isn’t to be pessimistic, but to make every investment decision with a clear and well-reasoned understanding of the underlying business and how it will evolve.

A similar question arises with Bitcoin. What is one Bitcoin worth? The only serious answer to this question is that one Bitcoin is worth whatever someone else is willing to pay for it. Value investors, like Buffett, avoid these hype-driven assets and choose to focus on assets that have fundamentals they can understand.

Price of bitcoin from 2010 to sept 2025

Why should you be interested in this post?

This quote offers a timeless lesson for anyone studying or working in finance: investing is all about discipline, critical thinking, and analytical rigor.

Whether you want to work in trading, M&A, private equity, private debt, asset management, or any other financial field, understanding the distinction between price and value is essential.

As a final thought, you may find it very interesting to apply this principle to your own career choices. Look beyond appearances and seek roles that align with your long-term values and curiosity.

Related posts on the SimTrade blog

   ▶ All posts about Quotes

Useful resources

Business

Berkshire Hathaway

Warren Buffett (2024) Warren Buffett’s 2024 letter to investors, Berkshire Hathaway.

Academic research

Fama E. (1970) Efficient Capital Markets: A Review of Theory and Empirical Work, Journal of Finance, 25, 383-417.

Fama E. (1991) Efficient Capital Markets: II Journal of Finance, 46, 1575-617.

Hou K., H. Mo, L. Zhang (2017) The Economics of Value Investing, NBER Working paper 25563.

About the author

The article was written in October 2025 by Hadrien PUCHE (ESSEC Business School, Grande École Program, Master in Management, 2023-2027).