The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition)I just started reading "The Intelligent Investor" by Benjamin Graham. The cover advertises that it's the "definitive book on value investing". Warren Buffet says it's "by far the best book on investing ever written".
I was bored at the airport and bought it and started reading it. So far, it's been good. It's a little confusing on which voice is the author's because my edition has commentary by Jason Zweig, but it definitely has some interesting points or tips which are directly relevant to this blog!
Below are snippets of good quotes/advice that seem very applicable to investing today.
1. Obvious prospects for physical growth in a business do not translate into obvious profits for investors.
2. The experts do not have dependable ways of selecting and concentrating on the most promising companies in the most promising industries.
By the time everyone decides that a given industry is "obviously" the best one to invest in, the prices of its stocks have been bid up so high that its future returns have nowhere to go but down... The people who now claim that the next "sure thing" will be health care, or energy, or real estate, or gold, are no more likely to be right in the end than the hypesters of high tech turned out to be.
Finally, what was most sobering so far was the following comment in a 1949 edition of the book, regarding the high flying airline stocks of its time, which might have been similar to the dot com tech stocks earlier this decade. I find it interesting and ironic that airlines are still a troubled industry today, but at one time, it was "the hot industry".
"Such an investor may for example be a buyer of air-transport stocks be cause he believes their future is even more brillant than the trend the market already reflects... In the year 1970, despite a new high in traffic figures, the airlines sustained a loss of some $200 million for their shareholders... It is commonly accepted today that the cumulative earnings of the airline industry over its entire history have been negative."
Link to the book on amazon.com:
The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition)
I was bored at the airport and bought it and started reading it. So far, it's been good. It's a little confusing on which voice is the author's because my edition has commentary by Jason Zweig, but it definitely has some interesting points or tips which are directly relevant to this blog!
Below are snippets of good quotes/advice that seem very applicable to investing today.
1. Obvious prospects for physical growth in a business do not translate into obvious profits for investors.
2. The experts do not have dependable ways of selecting and concentrating on the most promising companies in the most promising industries.
By the time everyone decides that a given industry is "obviously" the best one to invest in, the prices of its stocks have been bid up so high that its future returns have nowhere to go but down... The people who now claim that the next "sure thing" will be health care, or energy, or real estate, or gold, are no more likely to be right in the end than the hypesters of high tech turned out to be.
Finally, what was most sobering so far was the following comment in a 1949 edition of the book, regarding the high flying airline stocks of its time, which might have been similar to the dot com tech stocks earlier this decade. I find it interesting and ironic that airlines are still a troubled industry today, but at one time, it was "the hot industry".
"Such an investor may for example be a buyer of air-transport stocks be cause he believes their future is even more brillant than the trend the market already reflects... In the year 1970, despite a new high in traffic figures, the airlines sustained a loss of some $200 million for their shareholders... It is commonly accepted today that the cumulative earnings of the airline industry over its entire history have been negative."
Link to the book on amazon.com:
The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition)
Posts
No comments:
Post a Comment