8

CHAPTER

Practicing the Art of Patience

THE FIFTH ELEMENT

All men ’ s miseries derive from not being able to sit in a quiet room

alone.

— Blaise Pascal

The fi nancial media does a great job of sensationalizing the day

trader who made 100 times his salary in one year or the hedge fund

manager who timed the mortgage crisis just right and earned $ 3 bil-

lion in one year. For every one of these outliers, though, there are

thousands of others who have failed terribly. Many investors tend to

forget that slow and steady will always win the race. Investors who

embark on a strategy of trying to reap riches quickly often face a simi-

lar outcome: continued loss of permanent capital.

Value investing, by its very nature, is about the gradual appreci-

ation of capital. At times, value investors certainly will be rewarded

with quick profi ts, but such bounty should be viewed as an added

bonus to a disciplined approach. Value investing is a comprehen-

sive investment philosophy that emphasizes the need to perform

intense fundamental analysis, pursue long - term investment results,

minimize risk, and, above all, resist herd mentality. The true value

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