35 of 39 people found the following review helpful:
4.0 out of 5 stars
A great book, June 18, 2006
This review is from: The Aggressive Conservative Investor (Wiley Investment Classics) (Paperback)
This book accomplishes two quite different things, both of which should be of use to the committed investor. First of all, it sets forth an investment philosophy in great detail. Second, it shows investors how to analyze securities themselves. In both those respects, it is on a par with "Securities Analysis" by Graham and Dodd (also highly recommended - I have also reviewed that book), although it is a much easier read.
In setting forth an investment philosophy, the book compares well with "Common Stocks and Uncommon Profits" by Phil Fisher and "The Intelligent Investor" by Benjamen Graham (both recommended). Whereas Fisher emphasized growth companies and management analysis and Graham emphasized earnings, Whitman and Shubik emphasize low price/book ratios. They support their position quite ably with examples and , where available, studies.
The Aggressive Conservative Investor also contains a good bit of information about securities analysis. While it is not as in-depth as "Security Analysis" (the Graham and Dodd classic), the chapters on financial accounting and GAAP are a must read, particularly since the book convincingly demonstrates that the utility of financial statements will differ depending upon the position of the person reviewing them.
Whitman and Shubik are most certainly value investors who focus on analyzing a particular company (as compared to the market as a whole, interest rate trends, etc.), although they also cover "asset conversion investing," which may involve investing in distressed companies. They make an excellent argument that, in many cases, companies with unencumbered assets may make excellent investments. They also freely take exception to accounting conventions that emphasize earnings, and they repeatedly demonstrate how earnings may be affected by accounting policies that are beyond the control (and arguably the understanding) of most investors, including me.
Another interesting thing about this book is that it covers different corporate constituancies (banks, bondholders, management, insurance companies, passive outside shareholders, etc.) and how their involvement affects and is affected by corporate activities in great detail. The book notes that even investors in common stock may have different objectives, and it discusses how these perspectives may affect the company over time.
The book also has an excellent discussion of sources of corporate disclosure, in order to take advantage of the company's public communications to understand it better. While I am generally aware of many of these sources, the book does a commendable job of explaining them in greater detail.
The Aggressive Conservative Investor does contain some numeric analysis that may be hard to follow, and it can't be called an "easy read," although it certainly is not as hard to read as "Security Analysis." Moreover, some of the information contained in the book is now outdated due to changes in the tax code. These are minor concerns to me, however, and I would highly recommend this book to anyone who is serious about investing.
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43 of 51 people found the following review helpful:
5.0 out of 5 stars
"safe and cheap" in the master's own words, July 13, 1998
By A Customer
Marty Whitman is a master value investor who has been successful for 3 decades, though recently becoming known to the masses through his Third Avenue family of mutual funds. Anyone who has read some of his shareholder letters will recognize some of the concepts in the book, but they are presented in detail. This book teaches you to understand how "control" investors think, and to then learn how to evaluate annual and quarterly statements in a new light. Whitman is more than a value investor, of course, he is a vulture investor and proud of it. Though this book is as fresh today as it was in 1979, we await his new book eagerly for more wisdom from the master. Marty Whitman's approach is as different from Ben graham's as the Rolling Stones were from the Beatles! Both early rock bands from England, but clearly touched responsive chords in very different ways...If you can find this book, BUY IT!
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11 of 11 people found the following review helpful:
5.0 out of 5 stars
A masterpiece, December 28, 2006
This review is from: The Aggressive Conservative Investor (Wiley Investment Classics) (Paperback)
The most extraordinary part of The Aggressive Conservative Investor is that it tells the reader how minority investors can benefit by knowing and understanding how control investors make investment decisions.
If one is smart enough to realize how insiders and control investors made fortunes by taking advantage of the market cycles to do the arbitrage between private and public market, one will come to appreciate the beauty of the safe-and-cheap approach as detailed in this book.
I have come across a few negative comments on the book regarding the use of "out-dated" materials. This certainly does not take me by a surprise, as not everybody has 50 years of investment experience as Whitman does, so, naturally, not everybody can understand what "there is no new thing under the sun" means.
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