Author – Benjamin Graham
Cover – Artist Donavan Hayes
Country – United States
Language – English
Subject – Securities & Investment
Publisher – Harper & Brothers
Publication – Date 1949
Pages – 640
ISBN – 0-06-055566-1 (2008 edition)
The Intelligent Investor depends on esteem contributing, a speculation approach Graham started educating at Columbia Business School in 1928 and along these lines refined with David Dodd. This estimation was resounded by other Graham educates, for example, Irving Kahn and Walter Schloss.
The Intelligent Investor likewise denotes a noteworthy deviation to stock choice from Graham’s prior works, for example, Security Analysis. He clarified the change as: “What I have been accentuating in my own work throughout the previous barely any years has been the gathering
approach. To attempt to purchase gatherings of stocks that meet some basic model for being underestimated – paying little mind to the business and with almost no regard for the individual organization… I found the outcomes were generally excellent for a long time. They positively did twice just as the Dow Jones. Thus my eagerness has been moved from the specific to the gathering approach.”
There is no such thing as a good or bad stock; there are only cheap stocks and expensive stocks. Even the best company becomes a “sell” when its stock price goes too high, while the worst company is worth buying if its stock goes low enough.— Clear Investing (@clearinvesting1) July 26, 2020
~Benjamin graham pic.twitter.com/G2yJ2eKhGp
The book starts with a note that it is “ BY FAR THE BEST BOOK ON INVESTING EVER WRITTEN” from one of the world’s most richest persons and biggest business tycoons , Mr. Warren E. Buffet. It itself tells how valuable this book is and motivates one to read it at least once in their lifetime.
Benjamin Graham’s goal was to give a venture strategy book to the normal speculator. He prevailed with regards to placing apparently hard ideas into terms that could be comprehended and, all the more significantly, executed by the normal financial specialist.
The run of the mill financial specialist tends to “follow the market” when they ought to utilize portfolio chance administration systems. Rather, Graham gives us an option dependent on major stock examinations. The objective is to figure out how to maintain a strategic distance from the traps of permitting our feelings to control our speculation choices. Or maybe, Graham gives the establishment to settling on systematic choices.
The Intelligent Investor puts exceptional accentuation on instructing:
- Hazard the executives through resource distribution and broadening.
- Expanding probabilities through valuations investigation and edge of wellbeing.
- A trained methodology that will forestall weighty blunders to a portfolio
This book enlightens us by instructing us that there are two types of investors.
- Speculators, a person who buys a stock for short periods of time in order to profit from changes In its price
- Investors, Is the one who buys a company .
Speculators must be smarter and better informed than vast majority of their competitors .if someone without knowledge attempts to speculate they are likely to perform worse than the market average
This book doesn’t tells you how to be a Millionaire, but it tells you
- How you can minimize the odds of suffering irreversible losses.
- How you can maximize the chances of achieving sustainable profits
- How you can control the self defeating behavior that keeps most investors from reaching their full potential
Graham details six key principles of “Intelligent Investing”
- You should know the business you are investing in
- Know who administers the business.
- Invest for sustainable profits over time , not for speculation.
- Always choose more valuable stocks rather than more popular stocks.
- Always invest with a margin of safety.
- Have confidence in your own analysis and observations.
An investor should have full faith in his analysis and should not listen to others. And he should not be afraid of the market that keeps on fluctuating.
The crux of the book can be concluded with a quote by Benjamin Graham.
“THE INTELLIGENT INVESTOR IS A REALIST WHO SELLS TO OPTIMISTS AND BUYS FROM PESSIMISTS.”