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Wall Street Words of Wisdom

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Wall Street is known for coming up with quick-hitting quotes to help explain what’s happening in the financial markets.

Some of the sayings are truly time-tested pearls of wisdom. For example, the expression “time in the market beats timing the market” has been sound guidance for generations of investors.

But what about some of the other ones? Do they provide valuable insight? Or could they be considered a bit reckless–like “Sell in May and go away” from the Stock Trader’s Almanac? While that saying has had some merit over the years, it didn’t work out too well in 2024.

So, here’s some Wall Street maxims, mixed in with some questionable insights. See if you can separate the actual quotes from whimsical ideas.

 “According to Webster, wisdom allows us to apply information and knowledge to effectively and efficiently achieve the desired end result,” writes Mick Owens, author of the popular book Diamond of Life: The Five P’s of Success and Significance. “Therefore, it behooves each of us to see wisdom diligently.”

Wall Street Words of Wisdom

1 / 10

October: This is one of the peculiarly dangerous months in which to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August, and February.”

2 / 10

“Wall Street is about winning and losing. The trick is you have to keep winning.”

3 / 10

“Buy the rumor; sell the news.”

4 / 10

“Bull markets climb a ‘wall of worry’."

5 / 10

“One of the oldest sayings on Wall Street is ‘Let your winners run and cut your losers.’ It’s easy to make a mistake and do the opposite, pulling out the flowers and watering the weeds.”

6 / 10

“Sometimes you have to ignore risk when an opportunity comes knocking."

7 / 10

“Stocks take the escalator up and the elevator down.”

8 / 10

“Be fearful when others are greedy and be greedy when others are fearful.”

9 / 10

“It’s important to know the trend before investing one penny in the stock market.”

10 / 10

“Only buy something that you’d be perfectly happy to hold if the market shut down for ten years.”

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  1. True! Words to live by from Mark Twain in the book, Pudd’nhead Wilson, published in 1894, long before the stock market troubles in 1929.
  2. False. We just made this one up! Investing is about creating a portfolio that reflects your goals, time horizon, and risk tolerance. There’s no trick or shortcut.
  3. True. Sometimes, the rumor of good news will influence a stock’s price. Then, when the news actually gets released, some traders are quick to take profits.
  4. True. The stock market is a discounting mechanism, meaning it’s accounted for all of today’s news and is looking 6–9 months into the future. So, during times of pessimism and skepticism, stock prices can “climb a wall of worry” as they look to better times in the future.
  5. True. This is some insight from legendary money manager Peter Lynch. Too often, individual investors get pushed around by overconfidence, regret, and trend-chasing. These factors can lead to emotion-driven decisions.
  6. False. We made that one up, too. It’s unwise to ignore risks, regardless of the potential opportunity.
  7. True. Bull markets often unfold gradually over many years as the economic and business cycles unfold. Bear markets, on the other hand, often happen much quicker.
  8. True. Warren Buffett passed along this insight to investors in 2008.
  9. False. We had a little fun with this one. No one has a crystal ball. But everyone can create a strategy based on their goals.
  10. True. Another gem from Warren Buffett, who encouraged investors to believe in their portfolio even during market downturns.

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