The Intelligent Investor

from Wikipedia, the free encyclopedia

The Intelligent Investor by Benjamin Graham is a book about investing in securities . It was published in 1949 and the current edition, with comments by Jason Zweig, is from 2003. Warren Buffett , a former Graham student while teaching at Columbia Business School , once said, “By far the best book ever written about investing has been."

content

As with its predecessor Security Analysis from 1934, the content of the book is Value Investing , which Benjamin Graham founded together with others. Value investing is the clear opposite of more speculative strategies like "momentum trading" or "chart analysis". In its basic assumptions, it also clearly contradicts the view that share prices are efficient. Efficient in this context means that the market as a whole always knows all the necessary information about a company and can therefore always price it promptly into its share prices. The consequence would therefore be that there could be no mispricing of stocks, so the price of a stock would have to reflect the fundamental value of a company at all times (or at least in most cases).

Graham vehemently contradicted this view. If a company's share price were reasonable at all times and in line with its true value, no one could ever benefit from the undervaluation of the market from time to time. The supporters of Graham today argue that the successes of Warren Buffett , who justifies his immense wealth growth precisely by investing in undervalued companies, cannot be explained by efficiency theory.

Some advocates of the market efficiency hypothesis argue that Buffett is an absolute anomaly . Buffett himself countered that there were many others who achieved similar success by applying the principles of value investing , as Graham once put them. His now famous essay The Superinvestors of Graham-and-Doddsville is hard to refute evidence of the successful implementation of value investing by several individuals who all go back to the same “progenitor” (Ben Graham).

Issues published so far

Since it was first published in 1949, several new editions of the book have appeared. In 1973 the fourth revised edition came out ( ISBN 0-06-015547-7 ), provided for the first time with a foreword and appendix by Warren Buffett. Graham died a short time later, so there were no more changes to the content. In 2003 a new edition of this fourth edition was finally published with comments and footnotes by Jason Zweig , which are primarily intended to provide a current reference to the market situation at the turn of the millennium.

German edition