Stock market investments are as risky as they are lucrative. Anyone who has burned their fingers by investing in the bull run, will tell you that it is too risky and doesn’t work. But that’s the thing. It works, if you know what you are doing. Riding on the euphoria is the common mistake of a rookie investor. The Intelligent Investor, a classic and a must read for many in Finance and Investment, Ben Graham explains the secrets of investing in the stock market. He doesn’t promise that you will make a lot of money, but if you follow his simple rules, you will earn more than the interest you bank offers.
Ben Graham is father of Securities analysis and framing methods of financial analysis of stocks and companies used even today to make an intelligent decision.
The Intelligent Investor: The Definitive Book on Value Investing
Author: Benjamin Graham, Jason Zweig, Warren E. Buffett (Collaborator)
Series: Collins Business Essentials
Paperback: 640 pages
Publisher: HarperBusiness; Rev Sub edition (February 21, 2006)
ISBN: 0060555661, 978-0060555665
The Intelligent Investor Book Review
The book begins with an introduction by Warren Buffet, whom Graham mentored, and Zweig. They both give insights about Graham’s difficult childhood, his brilliant performance at Columbia, and his wins and losses at eh market. Just reading through this introduction will give the first-investor enough to think and defend against the vagaries of the stock market.
The guide is not written for the brokers that you see in movies talking on the phone or shouting in the market well. It is meant for you, the regular guy. A guy who intends to get best possible returns for his investments, but one who doesn’t dream of making it rich overnight. He makes the basic distinction between an investor and a speculator or a gambler. Looking back into the multiple market ups and downs, he shows how a long-term investor in Index stocks earns the best for his investment without risking a lot.
In an easy to understand prose graham lays out all the Dos and Don’ts of investing in securities. The first part helps you build an investing mindset that is mostly defensive, but one that will shield you from catastrophic losses. he doesn’t delves into the various technical indicators and charts, but points out the most important numbers that you should pay attention to before making an investment decision.
The author also discusses other investment instruments like Bonds and the role of inflation. By explaining the fundamental forces that affect investments in financial instruments, the books gives you a solid foundation that will guide you through your life as you build and manage your investment portfolio. The Intelligent Investor is without doubt the book you should read before you decide to begin your savings and investments.
Warren Buffet on The Intelligent Investor