“It may be said, with some approximation to the truth, that
investment is grounded on the past whereas speculation looks primarily to the
future. But this statement is far from complete. Both investment and
speculation must meet the test of the future; they are subject to its
vicissitudes and are judged by its verdict. But what we have said about the
analyst and the future applies equally well to the concept of investment. For
investment, the future is essentially something to be guarded against rather
than to be profited from. If the future brings improvement, so much the better;
but investment as such cannot be founded in any important degree upon the
expectation of improvement. Speculation, on the other hand, may always
properly—and often soundly—derive its basis and its justification from
prospective developments that differ from past performance.”
