Benjamin Graham: The Intelligent Investor
“The Intelligent Investor” by Benjamin Graham is a classic investment guide that provides timeless principles for successful investing. Published in 1949, Graham’s approach emphasizes a conservative, value-oriented strategy to navigate the unpredictable stock market.
The central concept in the book is the distinction between two types of investors: the defensive, or “intelligent,” investor and the speculative investor. Graham encourages investors to adopt a defensive approach, focusing on long-term security and minimizing risk. He introduces the concept of “Mr. Market,” an imaginary character representing the stock market’s fluctuations, advising investors to take advantage of market irrationality rather than succumbing to it.
Graham’s key investment principle is “value investing,” which involves analyzing stocks as if they were pieces of a business rather than mere market symbols. He advocates for a margin of safety, suggesting that investors buy stocks when their market price is significantly below their intrinsic value.
Additionally, the book discusses the importance of diversification, the role of market psychology, and the need for a disciplined investment strategy. Graham’s teachings have influenced many successful investors, including Warren Buffett, who considered “The Intelligent Investor” a cornerstone of his investment philosophy.
In summary, Benjamin Graham’s “The Intelligent Investor” remains a foundational guide for investors, emphasizing the principles of value investing, long-term thinking, and a disciplined approach to navigate the complexities of the stock market.
Author: Benjamin Graham
Title: The Intelligent Investor
Subtitle: The definitive book on value investing
Year: 2006 (First Collins Business Essentials edition)
ISBN: 978-0-06-055566-5