Benjamin Graham

Benjamin Graham (May 8, 1894–September 21, 1976) was an American economist and investor. He was born in London, graduated from Columbia University at the age of 20, and became Warren Buffett’s teacher in 1950.

Graham is the author of The Intelligent Investor, a seminal book on value investing that Warren Buffett called “by far the best book on investing ever written.” Buffett was just one of Graham’s disciples. Graham also taught or influenced Mario Gabelli, John Neff, Michael Price and John Bogle. 

Why do we have an investment newsletter named after Benjamin Graham at Cabot? First, Graham is widely celebrated as “The Father of Value Investing.” He created the process of evaluating companies to find their intrinsic value. Graham could thereby purchase companies with undervalued stock prices and avoid buying companies with over-inflated prices.

Cabot Benjamin Graham Value Investor recommends stocks based on the Benjamin Graham investing system. Graham analyzed every company according to seven factors: profitability, stability, earnings growth, financial position, book value, dividends and price history. He analyzed every potential investment based on these factors to determine which companies were clearly undervalued.

A key concept of the Benjamin Graham system is the Margin of Safety, which is achieved by buying a stock only when it falls below its maximum buy price. That price is calculated using the metrics that determine the intrinsic value of a company. Strict adherence to the rule of buying only below the maximum buy price will minimize potential losses while maximizing potential profits.

In essence, Graham developed a whole new approach to investing based on principles of measuring a stock’s price versus its intrinsic value. For nearly a full century, that approach has beaten the market. Since 1926, the Benjamin Graham value investing approach has achieved average annual returns of 20% a year.

Using Graham’s principles, our value investing expert J. Royden Ward has achieved similar returns for his subscribers. Since Cabot Benjamin Graham Value Investor's inception in 2002, Roy’s recommendations have generated a 258% return for his readers—more than double the 117% return in the S&P 500 over that time span.

Cabot Benjamin Graham Value Investor caters to conservative investors looking for low-risk, high-quality stocks that other investors have overlooked. The Investor adheres to Graham’s principles of providing a margin of safety by recommending only stocks that are clearly trading below their intrinsic value.

Benjamin Graham was a pioneer of financial analysis who is still recognized today as one of Wall Street’s most successful investors. By embracing his core principles of value investing, we have achieved Graham-like returns for our subscribers and expect to continue doing so for years to come 

Analysts Center

Our analysts regularly share content from their premium advisories. See a sampling of our analysts’ unique takes on current market conditions and how they impact a wide range of investments.


Benjamin Graham's Seven Criteria for Picking Value Stocks

Here are Benjamin Graham's seven time-tested criteria to identify strong value stocks.»

Short Biography of Benjamin Graham

Benjamin Graham was born in London in 1894. (His original name was Grossbaum, but he changed it as a young man, the better to fit into the Wall Street environment.)»

Some Value Investing History

The investment principles taught by Graham at Columbia University became legend in the field of professional stock analysis.»

Benjamin Graham's Mr. Market

One of Benjamin Graham's favorite parables is that of Mr. Market. Graham refers to him several times in his book, The Intelligent Investor.»

Warren Buffett's Seven Investing Guidelines

Warren Buffett learned well from Benjamin Graham, and made one successful investment after another. These seven guidelines will help you to invest like Warren Buffett.»

Stock Picks

Tesla Motors

If you’re not on board the stock, there’s no rush. Wait for a better entry point in a more constructive market.

Church

Church & Dwight owns the Arm & Hammer, OxiClean and Trojan brands, as well as some smaller, faster-growing brands. But even after a 35% climb in 18 months, Church & Dwight still looks strong and poised for further gains.

Restoration Hardware

Restoration Hardware (RH) has been on my watch list for a long time. Believe it or not, I’ve been watching the stock for about a year—it was my Top Pick at the 2014 Cabot Investors Conference, nearly one year ago—and now, after a ton of starts and stops, shares look poised to get going.

Cabot Wealth Advisory

Market Shocks (and Aftershocks)

By Paul Goodwin on August 28, 2015

In the stock market, September is usually a time of increased purpose, as the giants of Wall Street return from their summer vacations (after Labor Day), tanned, re-energized and ready to grapple with the market and its challenges.Read More >

My First Market Crash

By Timothy Lutts on August 27, 2015

Everyone remembers their first market crash. Mine was October 19, 1987, when the Dow fell 508 points (22.6%) in one day. This, of course, was before we all had computers on our desks (and in our pockets) to keep us up to date on what was happening. All we had were telephones—and unanswered questions about how some poorly understood computer-trading programs had allowed this to happen.Read More >

Four Ratios and Ratings to Increase Your Returns

By J. Royden Ward on August 25, 2015

My value approach seems contrary to the thinking of most investors, but I believe selling when the market is high and buying when the market is low makes sense. Read More >