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Be skeptical of market hype and trends from "summary" of The Intelligent Investor by Benjamin Graham
The intelligent investor must be wary of succumbing to the allure of market hype and trends. It is all too easy to be swept up in the excitement of a booming market or the latest fad investment, but this can lead to hasty decisions that are not based on sound reasoning. Graham emphasizes the importance of maintaining a healthy skepticism towards market hype and trends. Just because everyone is talking about a particular stock or asset class does not mean it is a wise investment. In fact, it often means the opposite - that the price has already been bid up to unsustainable levels. The intelligent investor understands that markets are driven by fear and greed, and that these emotions can lead to irrational behavior. By keeping a level head and not getting caught up in the latest craze, one can avoid making costly mistakes. Instead of following the crowd, the intelligent investor focuses on fundamental analysis and valuation. They look for companies or assets that are trading below their intrinsic value, rather than ones that are overhyped and overpriced. By approaching investing with a healthy dose of skepticism and a focus on long-term fundamentals, the intelligent investor can avoid being swayed by market hype and trends. This disciplined approach may not always be as exciting as chasing the latest hot stock, but it is far more likely to lead to sustainable long-term success.
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