Think Like the Father of Value Investing
If the starting point of the world of analysts has an equivalent to the universe's Big Bang, it is found in Benjamin Graham. British-born and New York-raised, Graham is widely considered the forerunner of today's analysts. A public figure during this lifetime, today -- 35 years after his death -- he remains a touchstone for many analysts and investors. In fact, his most famous student is Warren Buffett, who continues to extol Graham's importance. Buffett attended graduate school at Columbia University specifically in order to study under Graham, and he worked for Graham before starting out on his own.
Graham approached stock buys as though he were buying the company itself, taking into account all of the company's profit, debt, assets and revenue streams. His rationale: In the short run, stocks are unpredictable, but over the longer term, a stock's price tends to move in ways that reflect the real value of its business. This, in turn, is indicated by such fundamentals as price-to-earnings ratio, price-to-book ratio, sales, profit and the debt-to-asset ratio....520 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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