margin of safety diagest

The first rule is "Don't lose money", The second rule is "never forget the first rule".
I believe that avoiding loss should be the primary goal of every investor. "Don't lose money" means that over several years an investment portforlio should not be exposed to appreciable loss of principal.

It can be hard to concentrate on potential losses while others are greedily reaching for gains.

If you had $1000, would you be willing to wager it, double or nothing, on a fair coin toss? probably not. Would you risk your entire net worth on such a gamble? Of course not. Would you risk the loss of,say, 30% of your net worth for an equivalent gain? Not many because the loss of a substantial amount of money could impair their standard of living while a comparable gain might not improve it commensurately. If you are one of the vast majority of investors who are risk averse, then loss avoidance must be the cornerstone of your investment philosophy.
Targeting investment returns leads investors to focus on upside potential rather than on downside risk.
value investing is the discipline of buying securities when their price has a substanitial discount of their underlying business value and holding them until more of their value is realized. The element of a bargain is the key to the process. buying a dollar for 50 cents.

value investing combines the conservative analysis of underlying value with the requisite discipline and patience to buy only when a sufficient discount from the value is available.

The greatest challenge for value investors is maintaining the required discipline. Being a value investor, usually means standing apart from the crowd, challenging conventional wisdom, and opposing the prevailing investment winds. It can be a very lonely undertaking. A value investor may experience poor,even horrendous, performance compared with that of other investors of the market as a whole during prolonged periods of market overvaluation. yet over the long run the value approach works so successfully that few, if any, advocates of the philosophy even abandon it.

wait for the perfect pitch, allowing dozens, even hundreds, of pitches to go by, including many at which other batters would swing. They are not influenced by the way others are performing, they are motivated only by their own results. they have infinite patience and are willing to wait until they are thrown a pitch they can handle and undervalued investment opportunity.

For a value investor a pitch must not only be in the strike zone, it must be in his "sweet spot." Results will be best when the investor is not pressured to invest prematurely.