The lesson of leverage is this: Assume that the worst imaginable outcome will occur and ask whether you can tolerate it. If the answer is no, then reduce your borrowing.
- Ed Thorp - Topics: Leverage, Trader.
Using leverage is like playing Russian roulette. It means that you are inevitably going to get a bullet in the head.
- Ray Dalio - Topics: Leverage, Trader.
A leveraged portfolio forces you to act irrationally when markets are irrational, as opposed to acting rationally when markets are irrational.
- Marc Lasry - Topics: Leverage.
Leverage is a two-edged sword. The edge that can cut you, cuts deeper.
- Naved Abdali - Topics: Leverage, Trader.
I think I am safe in asserting that the margin trader, speculator, gambler, or whatever you choose to designate the average man who goes to Wall Street after easy money, does not lose money when he sells. He loses it when he buys.
- Jesse Livermore - Topics: Leverage, Trader.
If a company gambles on leverage, it'll probably go bankrupt on leverage.
- Hendrith Vanlon Smith Jr. - Topics: Leverage, Trader.
While leverage is not directly responsible for every financial disaster, it usually can be found near the scene of the crime.
- Jim Mooney - Topics: Leverage, Trader.
It’s only when the tide goes out that you learn who has been swimming naked.
- Warren Buffett - Topics: Wall Street, Trader, Leverage.
Leverage can never turn a bad investment into a good one, but it has the potential to turn a good investment into a bad one by forcing you to sell at just the wrong point in time.
- James Montier - Topics: Leverage, Money Management, Trader.
Leverage has the potential to turn a reasonably good investment into disastrous gambling.
When you combine ignorance and leverage, you get some pretty interesting results.
- Warren Buffett - Topics: Leverage, Trader.
Derivatives are financial weapons of mass destruction.
- Warren Buffett - Topics: Banking System, Leverage, Wall Street.
There are only three ways a smart person can go broke: liquor, ladies and leverage.
- Charlie Munger - Topics: Leverage, Trader.
Almost every financial blow-up is because of leverage.
- Seth Klarman - Topics: Leverage, Trader.
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