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Been Quote by Kenneth Fisher

“Most investors give too much credence to the theory that prices are rational; they presume that a market collapse must have been justified by serious economic trouble.” quote by Kenneth Fisher
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“Most investors give too much credence to the theory that prices are rational; they presume that a market collapse must have been justified by serious economic trouble.”

Kenneth Fisher

About This Quote

Source Book: The Intelligent Investor’s Guide, 2015

Investors overtrust rational price theory, assuming market crashes always have solid economic reasons

In simple terms: Investors assume rational prices and justified crashes

Key Takeaway

Question assumptions about market rationality

Themes

economics behavioral finance market theory

Mood

analytical skeptical

Type

financial educational

When to use this quote

  • investment strategy
  • economic analysis
  • risk assessment

Key Concepts

rationality systemic risk valuation bias

Questions to Reflect On

  • Do you consider irrational factors?
  • How to guard against overconfidence?
A Different Perspective

Markets can be irrational and driven by sentiment

3.9 out of 5 (4 ratings)

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