Benjamin Graham, the Father of Value Investing
Benjamin Graham is widely acknowledged as the father of modern security
analysis and the father of value investing. His timeless books,
Security Analysis and The Intelligent Investor, are considered the
bibles for both individual investors and Wall Street professionals.
Graham
co-founded Graham-Newman, investment advisors, and is recognized as one
of Wall Street’s most successful investors. However, his reputation as
the father of value investing can be dated to 1928 when he started
teaching Advanced Security Analysis at Columbia University. Graham
taught or influenced later investment gurus Warren Buffett, Mario
Gabelli, John Neff, Michael Price, John Bogle—and
Cabot Benjamin Graham Value Letter editor
J. Royden Ward.
Graham’s
classes and books were the foundation of a whole new approach to the
investment industry based on principles of measuring a stock’s price
versus the company’s intrinsic value and applying a margin of safety. A
pioneer in financial analysis, Graham developed resilient techniques
that could be followed in any market. He popularized the examination of
price-to-earnings ratios, debt-to-equity ratios, dividend records, net
current assets, book values, and earnings growth.
Since 1926,
Benjamin Graham’s timeless value investing approach has achieved
returns of 20% per year with low risk regardless of the market's ups
and downs.
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