GRAHAM REVIEW
Graham's original work itself is fantastic, if you take the time to absorb it and understand it. It took me two reads before I really felt like I grasped it well. I don't need to write an elaborate review discussing this book for people to know it is obviously an investment classic; it has Warren Buffett's full endorsement which is the reason a lot of people opt to read it in the first place. The practical advice offered is timeless. In particular I found Chapter 1 (the difference between speculation and investing), Chapter 8 (managing your emotions), Chapter 10 (discerning the advice from others) and Chapter 20 (having a margin of safety) to be enlightening, as those four chapters were probably the most useful to me personally. The advice in the very first chapter regarding the difference between investing and speculating gets lost on a lot of people today, as anything and everything that involves stocks, bonds, options, or futures seems to be categorized as investing. The portion of Chapter 8 that discusses managing your emotions is arguably the most difficult for people to actually implement in the real world, despite being a very important concept. Graham truly makes a compelling case in favor of a value approach, which as I will discuss later in this review, is inherently reliant on the belief that investments can and do become undervalued. Buffett notes that the most significant chapters for him were 8 and 20. I agree, but also add chapters 1 and 10 to that shortened list. For others that might be different.
A unique thing that I appreciated about Graham is that he discusses two different ways of investing, depending on how much time you have to put into the matter. For those who have too many other things going on to put the time into it, he advocates "defensive investing," which basically focuses on safer, larger companies and is a little more bond-heavy. And for those who want to put a lot more work into it, he advocates "enterprise investing," where he lays out a more rigorous approach to value investing. While the enterprising method does indeed yield greater returns over the long run, there is nothing wrong with taking the defensive approach, particularly for those who aren't able to commit enough time in order to make the enterprising method effective.
There are a few minor areas that are no longer relevant as they were in Graham's day, such as his suggestion that one should use a local bank to handle transfers of stock certificates... when it is basically all online these days. But if one reads it and remains aware that it was written in the early 1970s, then these little quirks will not bother them. I will also add that Graham places an emphasis on dividend maintenance that is probably less relevant today. In his day, strong companies actually paid out about 1/3 to 2/3 of their surpluses, whereas these days that is far less common. Graham's followers, including Buffett and Klarman, do not emphasize this so heavily (Klarman has gone as far as saying that looking at dividend policy is almost useless in today's era), although it is still probably relevant to look at the continuity of dividends especially for "defensive" investors. It should be added that while Graham has an almost aloof/academic air about him, he is equally humble and sincere, never underestimating the intelligence of his readers. And for those occasional uppity words that he uses, there is always a dictionary nearby. It may take more than a cursory read, but if you are patient, then this book is a gold mine. As a result, I give Graham 5 stars.
ZWEIG REVIEW
Jason Zweig's commentary really deserves its own separate review, as this is basically two different books. Throughout MUCH (not all) of the book, I would have given Zweig 4 or 5 stars, as his commentary adds to the discussion and thought process of Graham. However, Zweig departs from Graham in a very fundamental way in three portions of the book, causing me to believe that Zweig either truly disagrees with or otherwise does not fully understand what Graham's argument is. Zweig essentially subscribes to the "Random Walker" camp of those supporting a Semi-Strong version of Efficient Market Hypothesis (EMH) and believes that one is simply speculating when choosing individual stocks instead of index funds. Zweig lets his own views seep into the book slowly, chapter by chapter, until it becomes more obvious that he is not a value investor. Graham did not subscribe to this relatively recent view (only existing since the 1960s) in his approach to VALUE investing. The entire premise of value investing is that securities sometimes do become undervalued, which is rare/impossible according to proponents such as Zweig. Though to my knowledge Graham never wrote a piece articulating his stance, his actions were to the contrary of what Zweig seems to believe his position was. It's also notable that his contemporaries/students blatantly countered the EMH viewpoint (see Buffett and "Superinvestors" below; see also Phil Fisher in "Developing an Investment Philosophy" chapter 4, entitled "Is the Market Efficient?").
(1) In the first and most notable departure for Zweig, there is a portion of the book where Graham says "[i]t would be rather strange if - with all the brains at work professionally in the stock market - there could be approaches which are both sound and relatively unpopular. Yet our own career and reputation have been based on this unlikely fact." (Graham, p. 380). If one reads the version in its proper context, then they will realize rather quickly that Graham is arguing that this unlikely fact of the markets actually being inefficient much of the time is actually TRUE, and is thus a compelling reason to study value investing. However... Zweig goes on in the commentary to say that Graham is pointing out that the market is efficient, and discusses the definition of the Efficient Market Hypothesis (EMH). This is clearly NOT what Graham was saying... rather the opposite.
(2) In the second notable departure, there is a commentary chapter of Zweig's where he discusses how to effectively manage your portfolio. In the chapter itself, Graham discussed stock selection. Zweig, however, goes on to say that people should not actually pick stocks with more than 10% of their money, as doing so is akin to speculating, and should instead place all or nearly all of their funds into index funds that can come close to tying the market because of the EMH. Even though this advice MIGHT (arguably) be relevant for the "defensive" investor that Graham discusses (those who do not have the time or want to put the time into managing their own portfolio), this advice is a blatant misrepresentation of what Graham advises for "enterprising" investors (those who want to actively practice value investing) in such a fundamental way as to make me want to give Zweig 1 star instead of 5. But due to my holistic review, Zweig gets more than 1.
(3) Zweig places an emphasis on diversification that I don't think Graham fully intended. Graham discusses the value of diversification throughout the book by taking multiple positions. Note though that Graham does NOT advocate buying everything...simply holding a few varied positions. But Zweig interprets this concept in such a way as to, in my humble opinion, advocate over-diversification... which is effectively nothing more than buying so many things that you should have just purchased an index fund to begin with.
Collectively, Zweig's most significant contribution to the book was simply putting some of Graham's now-dated statements into context. I'm not saying there's anything wrong with believing in EMH in the markets the way that Zweig does, per se. But I am harsh on Zweig because advocating EMH and claiming that any stock is "speculative" is a blatant misrepresentation of Graham's views and stance. Despite departing from Graham quite fundamentally in two or three areas, Zweig mostly added a beneficial/informative conversation. Thus I hesitantly give him 3 stars.
BUFFETT REVIEW
Warren Buffett has a brief introduction towards the beginning of the book that tells what readers can expect from reading his mentor, Graham. As already mentioned, he places additional emphasis on chapters 8 and 20. But more importantly, there is a compelling essay/speech by Buffett in the back of the book that is called "The Superinvestors of Graham and Doddsville" that was given at Columbia University in 1984. You don't have to buy the book to read this essay, as it is free on the internet in a few different places. But it is arguably the best rebuttal to the Efficient Market Hypothesis that anyone has ever put out, and I don't know of any EMH proponents that have ever addressed Buffett's argument. In essence, Buffett points out that many different versions of investing that have little in common with each other beyond a decidedly long-term value-driven approach have all yielded positive results over time that have had decidedly superior returns to the market. There is unfortunately little written on this topic by actual practitioners, but Buffett's argument is worth a read. It's a definite 5 stars.
CONCLUSION
As a result, I give this whole book collectively 5 stars. You can just ignore the areas where Zweig errs, sometimes rather substantially. You could safely ignore his additional chapters/commentary altogether, although I think it is useful to read for putting certain portions of Graham's writing into perspective. Entire book is recommended; but if you don't read the whole thing, at least read Chapters 1, 8, 10, and 20, as well as Buffett's essay. It's a great addition to any investment library. I know that adding those up rounds to 4, but it is Graham's book after all (much as Zweig might wish it was his)... so it's 5 stars.
Loading your book clubs
There was a problem loading your book clubs. Please try again.
Not in a club? Learn more
Join or create book clubs
Choose books together
Track your books
Bring your club to Amazon Book Clubs, start a new book club and invite your friends to join, or find a club that’s right for you for free.
Download the free Kindle app and start reading Kindle books instantly on your smartphone, tablet, or computer - no Kindle device required. Learn more
Read instantly on your browser with Kindle for Web.
Using your mobile phone camera - scan the code below and download the Kindle app.
Flip to back Flip to front
Follow the Authors
Something went wrong. Please try your request again later.
| Price | New from | Used from |
|
Audible Audiobook, Unabridged
"Please retry" |
$0.00
| Free with your Audible trial | |
|
Spiral-bound
"Please retry" | $44.55 | $39.90 |
|
Audio CD, Abridged, CD
"Please retry" | $13.32 | $13.34 |
Book recommendations, author interviews, editors' picks, and more. Read it now
Frequently bought together
- +
- +
Total price:
To see our price, add these items to your cart.
Choose items to buy together.
Customers who viewed this item also viewed
Page 1 of 1 Start overPage 1 of 1
Videos
Page 1 of 1Start OverPage 1 of 1
Videos for this product
6:22
Click to play video
Should you Read - The Intelligent Investor? Review
Robert W.
Videos for this product
7:47
Click to play video
A Book Every Investor Should Read
The Math Sorcerer's Lair
Videos for this product
0:39
Click to play video
The Intelligent Investor Book Closer Look
Customer Product Reviews
Videos for this product
1:17
Click to play video
Unboxing The intelligent Investor Rev Ed Paperback
DIY Jun
Videos for this product
0:32
Click to play video
Hands Down Best Long Term Investing Book
Kyle Taylor
Buy stocks as groceries, not as jewelry.
Reviewed in the United States on June 22, 2016
Edition: I found commentary very useful (though often distracting). If you are not a professional - you'll appreciate the commentaries and epilogue - read it first? It's very inspiring.Book: "You either get the idea in the first five minutes, or you don't get it at all", commented Warren Buffet in the epilogue. I would add - you don't necessarily need to read all 550 pages, but you must read through the idea of value investing - and it will change your way of looking at the world. I always felt confused and amazed by listening to all the ridiculous fuzz that comes from the Wall Street through TV and the internet. The book explains why.Several rules of thumbs I noted into my keep:- Investor buys the business [based on its price/value], speculator buys the stock [based on an absurd believe that he can foresee where the stock price will go].- The best way to earn adequate return without any trouble whatsoever is to invest into cheap (low maintenance cost) indexes; use dollar averaging (buy every month instead of once at a random point of time) for smoothing the luck involved.- For enterprising investor (willing to spend much more time), look for a diversified list of bargain issues (at least 30 issues, business values (i.e. net current asset and other related metrics) is below market cap)- During the bubble, hot industries and companies are getting overpriced. That could only be financed from somewhere. Partially that money are coming from well established old economy companies that lose the appeal. Thus, invest in such old economy companies while bubble grows, as soon as the bubble burst - undervalued companies would rise back.- Don't ever buy IPOs! (See chapter for compelling arguments)- Don't consider companies that do not pay dividends. Dividends - money firm pays you for providing capital, they belong to you. They cut a piece for reinvestment - payout ratio. If firm doesn't pay dividends - invest all into growth so you could profit later - that's a speculation. Moreover stock price would be more volatile because it should now rely on future rather than current prospects.- When gambling - bet on a single chip to maximize the payoff (roulette $1 to $35 payoff at 1/37 chance). When investing - diversify: each investment must have a margin of safety, the more diversified portfolio - the less likely that all will fail. You are a roulette house now who earns with each turn of the wheel.
Reviewed in the United States on June 22, 2016
Images in this review
Top reviews from other countries
BhaveshB.O.T™
🔴#1 HONEST(Unbiased) REVIEW of The Intelligent Investor "Investment Book For Lifetime"
Reviewed in India 🇮🇳 on May 30, 2019
BhaveshB.O.T™
Reviewed in India 🇮🇳 on May 30, 2019
*Book: "You either get the idea in the first five minutes, or you don't get it at all", said Warren Buffet in the epilogue.
- I would add - you don't necessarily need to read all 550 pages, but you must read through the idea of value investing - and it will change your way of looking at the world.
- I always felt confused and amazed by listening to all the ridiculous fuzz that comes from the Wall Street through TV and the internet. The book explains why.
🔴Several rules I noted into my keep:
፨ - Investor buys the business [based on its price/value], speculator buys the stock [based on an absurd believe that he can foresee where the stock price will go].
፨ - The best way to earn adequate return without any trouble whatsoever is to invest into cheap (low maintenance cost) indexes; use dollar averaging (buy every month instead of once at a random point of time) for smoothing the luck involved.
፨ - For enterprising investor (willing to spend much more time), look for a diversified list of bargain issues (at least 30 issues, business values (i.e. net current asset and other related metrics) is below market cap)
፨ - During the bubble, hot industries and companies are getting overpriced. That could only be financed from somewhere. Partially that money are coming from well established old economy companies that lose the appeal. Thus, invest in such old economy companies while bubble grows, as soon as the bubble burst - undervalued companies would rise back.
፨ - Don't ever buy IPOs! (See chapter for compelling arguments)
፨ - Don't consider companies that do not pay dividends. Dividends - money firm pays you for providing capital, they belong to you. They cut a piece for reinvestment - payout ratio. If firm doesn't pay dividends - invest all into growth so you could profit later - that's a speculation. Moreover stock price would be more volatile because it should now rely on future rather than current prospects.
The Intelligent Investor, by Benjamin Graham, is probably the most important and influential value investing book ever written even Warren Buffet described it as “by far the best book ever written on investing”.
፨ If you could only buy one investment book in your lifetime, this would probably be the one.
፨ It had been 6 months since I last read The Intelligent Investor. I have enjoyed my personal “refresher course” in value investing.
🔴Objective of The Intelligent Investor Book
፨ Benjamin Graham’s objective was to provide an investment policy book for the ordinary investor.
፨ He succeeded in putting seemingly hard concepts into terms that could be understood and, more importantly, implemented by the average investor.
፨ The typical investor has a tendency to “follow the market” when they should be employing portfolio risk management strategies. Instead, Graham gives us an alternative based on fundamental stock analysis.
፨ The goal is to learn how to avoid the pitfalls of allowing our emotions to control our investment decisions. Rather, Graham provides the foundation for making businesslike decisions.
🔴The Intelligent Investor puts special emphasis on teaching:
1. Risk management through asset allocation and diversification.
2. Maximizing probabilities through valuations analysis and margin of safety.
3. A disciplined approach that will prevent consequential errors to a portfolio.
🔴If you have any Doubt regarding this Review or this Product, then Feel Free to Contact me or Just ask me by commenting below.I Hope this Review was Helpful.Write reviews, help others, happy shopping.
Thank You for Reading this Review.
-●➽ʙʜᴀᴠᴇsʜ ʙ.ᴏ.ᴛ 🔥
Images in this review
B.Sudhakar Shenoy
Investing is more a matter of ‘character’ than ‘brain’
Reviewed in India 🇮🇳 on August 14, 2018
Indranil Dey
paper quality all of this book is very good.
Reviewed in India 🇮🇳 on November 17, 2017
Indranil Dey
Reviewed in India 🇮🇳 on November 17, 2017
Printing, font size, paper quality all of this book is very good.
Images in this review
Matt Bourne
A must for anyone curious about investing...
Reviewed in the United Kingdom 🇬🇧 on September 20, 2018Amazon Customer
A great read for a 28-year-old
Reviewed in Canada 🇨🇦 on February 10, 2018
