The Intelligent Investor

Warren Buffett's favorite book on investing

This perennial bestseller originally written in 1949 by Benjamin Graham distills the basic concepts of value investing. My highlights: -Mr. Market knocks on your door every day with a quoted sales price. You have the power to accept or reject his offer based on your understanding of value. -One of the best ways to overcome fear of rise or fall in your holdings is to dollar-cost average (buy at a set interval regardless of recent market changes). -Some industries are probably never going to be very good investments due to regulation, margins, and competition (airline industry).
Warren Buffett stands on the shoulders of giants, and Ben Graham is the historical giant of value investing. This is the book that Buffett recommends to every investor, and it is fascinating from both a historical as well as financial perspective. When you read this book, you are stepping back in time, to a world before the Great Depression, when common stocks were still relatively new, and people bought them purely based on popularity, growth, or immediate payout. Graham was the one who first evangelized the idea that by looking at the core financials of a company – the assets and the dividends, you can make an informed judgement of the company’s value and the value of the stock. This book is recommended by Warren Buffet, and that’s why I’ve decided to read this book, and learn more from it. Warren claims that this book changed his way of thinking about “how to invest intelligently”, and if we see what Warren Buffet has accomplished so far, we all need to take his advice’s seriously. In conclusion, this book helped me a lot understanding how the stock market works, and how to invest intelligently. In today’s time, we are constantly “bombarded” by different kind of ads promoting “how to invest in stocks”. But, when I read this book, it changed my opinion completely. These days online “gurus” are constantly promoting trading every day, or every hour, and this book isn’t anything like that. There are section in this book that is talking about these kind of traders. Basically, Brokers makes all the money when you trade often, you have to pay them a fee, no matter whether you make or loose money. Investing in “bubble” it’s also a common problem, when too many people starts to buy one particular stock, and their prices goes up and up, but there are nothing valuable behind that stock, that could justify the high price of that stock. This book for this price offers so many valuable information, I’m saying it’s a bargain, and no one will regret buying this book.