Reviewed by Sarah Ell
My dad once told me, “physicists read about Sir Isaac Newton to learn about gravity, investors read Benjamin Graham's work to learn about investments.”
When I first heard this from Dad, I thought it was a very generalist thing to say and probably something that he had read elsewhere. However, the older I get, the more apparent it has become that Dad knows a thing or two about investments. At 85 years of age, he believes he has read the 1949 version of The Intelligent Investor more than fifty times and says that it has become like an old friend.
For Christmas a few years ago, I bought him the revised version with an introduction from Warren Buffet. Upon receiving the gift he said, “Thank you but I won’t read it.” On enquiring why not in a rather hurt tone, he told me jovially, “You don’t repaint the Sistine Chapel ceiling my boy, you just marvel at the original!” As you would expect, I don’t buy him investment books anymore.
Benjamin Graham (1894 – 1976) is remembered as ‘the father of value investing.’ He excelled at making money in the stock market without taking big risks. Graham has been lauded for creating safe investment principles, which were so successful that modern investors continue to use them today. All of these principles are detailed in The Intelligent Investor. In the revised 2003 version, there are twenty chapters covering matters such as inflation, stock market history, portfolio policy and security analysis.
In his text, Graham introduces the reader to his old friend ‘Mister Market’, who he likens to a business partner offering to buy you out or sell you his interest daily - you just have to assess whether the price on offer is reasonable or not. In essence, this book is a must for anyone who is interested in the investment world.