benWho was Jamin Graham, and why should you listen to him? Graham was not only the best investor of all time, he was the best investor of all timeGraham was also one of the greatest practical investment thinkers.
Before Graham, stock managers behaved much like a medieval guild, largely guided by superstition, speculation, and mystical rituals. Graham's Security Analysis was the book that transformed this old guild into modern professionals.And The Intelligent Investor is the first book to introduce individual investors to the emotional framework and analytical tools necessary for financial success. It is the best book on investing ever written for the general public.The Intelligent Investor was the first book I read after getting a job as a reporter at Forbes magazine in 1987 (a young reporter with little experience), and I was astounded by Graham's accuracy. All bull markets end in more or less a bad downturn. That October, U.S. stocks had the worst one-day drop in history, and I was mesmerized. (Today, after the wild bull market of the 1990s and the brutal bear market of the early 2000s, The Intelligent Investor is being read as even more prescient).Aham came to this realization through hardship; he studied the mindset directly through the pain of financial loss, and decades of market history. He was born Benjamin Grossbaum on May 9, 1894 in London. His father was a porcelain and sculpture merchant. When Ben was a year old, he became a teacher.'It was co-written with David Dand and the first four were published in 1934.*Reply: The family changed their name to Graham during World War I. In those days, German-sounding names were viewed with suspicion.When Ben was 18, 1856, the family moved to New York. Initially, they lived a luxurious life. Their home on Upper Fifth Avenue included a French governess, a butler and a housemaid. But Ben's father died in 1903, and his porcelain business failed, and the family slid into poverty. Ben's mother rented her home out as a boarding house, then borrowed money on margin to trade in stocks, which cleared in 1907. For the rest of his life, Ben remembered the humiliation of going to cash a check for his mother and hearing the bank teller ask, "Is Dorothy Grassbaum worth five dollars?"Fortunately, Graham won a scholarship to Columbia University, where his talents blossomed. He graduated second in his class in 1914. Before Graham's final semester, three departments—English, Philosophy, and Mathematics—offered him teaching jobs. He was 20 years old at the time.Braham decided to go to Wall Street instead of academia. He started as a clerk at a stock trading firm, quickly became an analyst, then a partner, and in a short time was running his own partnership investment firm.The rise and fall of the Internet would not have surprised Graham. In April 1919, he earned a 250% return on a single day's trading of a new two-business venture, Savold Tower. By October, the company had proven a failure and its shares plummeted.Brown had become an expert at researching the minute, almost molecular details of stocks. In 1925, the Puris Interstate Commerce Commission received a vague report of an oil pipeline leak.From this he learned that the Northern Pipe Line Company, then trading at $65 a share, had quality bonds worth at least $80 a share. He bought the stock, pestered its managers repeatedly to raise their profits, and three years later had acquired $110 a share on it.)Despite giving up nearly 70% of profits during the Great Crash of 1929-1932, Graham survived the fallout and prospered by taking advantage of his trading skills even when the stock market crashed. Ahn's prior record is not known, but from 1936 until his retirement in 1958, his Graham Fund leadership spanned at least 14 years.earned a NPA of 12.2%, which resulted in a market cap of 12.2% on the land, the best trading track record in Dal Street's history.How did Graham do it? By combining his ordinary brainpower with common sense and wide experience, Graham developed his basic principles, which remain at least as valid today as they were during his lifetime.A stock is not just a token or an electronic token, it is an ownership interest in an actual business whose intrinsic value is independent of its share price.The Bataar is like a pendulum, always oscillating between unsustainable optimism (which makes stocks too expensive) and unjustified pessimism (which makes them too cheap). The Intelligent Investor is a pathologist who sells to optimists and buys from pessimists.The future value of any investment is the result of its current price. The higher the price you pay, the lower your return will be.No matter how careful you are, there is one risk that investors can never escape - the risk of getting things wrong. The only emphasis here is on what Graham called the "margin of bread". Never overvalue what the investment might seem to be doing. This will help you minimise your own mistakes.The secret to your financial success lies within you. If you become a critical thinker who doesn't believe any 'statements' from Wall Street, and you invest with total confidence, you can make steady progress even in the worst of bear markets. By developing discipline and courage within yourself, you can prevent the mood swings of others from becoming your destiny. Finally, how you behave is more important than how your investments behave.This revised edition of Intensive Investor aims to present our views in full, with the exception of the explanatory footnotes.Graham's principles apply to the financial markets. You'll find new commentary after each chapter. In the instructions for readers, I've added recent examples that will show you how relevant and liberating Graham's principles are today.I envy your enthusiasm and enlightenment in reading Graham's 'masterpiece' for the first time or even the third or fourth time. Like all masterpieces, it changes the way we look at the world and renews it by educating us. The more you read, the better you will understand it. With Graham as your guide, you are guaranteed to become an even more intelligent investor.
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