For example, speculation is required for companies like Amazon who can’t raise the initial capital for expansion, and are running at severe losses for several years before turning profitable. There is such thing as intelligent speculation, which can be a good thing. Speculation involves decisions on the market price, hoping that someone will pay more than you did at a later date. You should allocate only 10% of your investment funds to what he deems speculation. Investment vs Speculation: Graham advises that investors need to keep investment and speculation separate – and know the difference between the two. The Intelligent Investor provides sound advice on the basic and outlines two roads each investor can take. What’s needed is a sound intellectual framework for making decisions and the ability to keep emotions from corroding the framework. To invest successfully over a lifetime, you don’t need a stratospheric IQ, unusual business insights or inside information. In The Intelligent Investor you’ll learn how to value a company (so you know when it is under or below it’s fair value), understand how stocks work and how to diversify a portfolio to best manage risk, sound investment philosophies (such as understanding the different between investment and speculation), and powerful questions to ask yourself when making an investment.īe the first to get our new & updated ‘Top 50 Best Books of All Time’: Benjamin Graham, the original ‘Father’ of Value Investing and mentor to Warren Buffet, delivers serious financial wisdom.
The Intelligent Investor reveals that investors successful over a lifetime don’t require a stratospheric IQ, unusual business insights or inside information.
The Intelligent Investor – by Benjamin Graham
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