Security Analysis: Sixth Edition, Foreword by Warren Buffett Author: Benjamin Graham | Language: English | ISBN:
0071592539 | Format: EPUB
Security Analysis: Sixth Edition, Foreword by Warren Buffett Description
"A road map for investing that I have now been following for 57 years."
--From the Foreword by Warren E. Buffett
First published in 1934, Security Analysis is one of the most influential financial books ever written. Selling more than one million copies through five editions, it has provided generations of investors with the timeless value investing philosophy and techniques of Benjamin Graham and David L. Dodd.
As relevant today as when they first appeared nearly 75 years ago, the teachings of Benjamin Graham, “the father of value investing,” have withstood the test of time across a wide diversity of market conditions, countries, and asset classes.
This new sixth edition, based on the classic 1940 version, is enhanced with 200 additional pages of commentary from some of today’s leading Wall Street money managers. These masters of value investing explain why the principles and techniques of Graham and Dodd are still highly relevant even in today’s vastly different markets. The contributor list includes:
- Seth A. Klarman, president of The Baupost Group, L.L.C. and author of Margin of Safety
- James Grant, founder of Grant's Interest Rate Observer, general partner of Nippon Partners
- Jeffrey M. Laderman, twenty-five year veteran of BusinessWeek
- Roger Lowenstein, author of Buffett: The Making of an American Capitalist and When America Aged and Outside Director, Sequoia Fund
- Howard S. Marks, CFA, Chairman and Co-Founder, Oaktree Capital Management L.P.
- J. Ezra Merkin, Managing Partner, Gabriel Capital Group .
- Bruce Berkowitz, Founder, Fairholme Capital Management.
- Glenn H. Greenberg, Co-Founder and Managing Director, Chieftain Capital Management
- Bruce Greenwald, Robert Heilbrunn Professor of Finance and Asset Management, Columbia Business School
- David Abrams, Managing Member, Abrams Capital
Featuring a foreword by Warren E. Buffett (in which he reveals that he has read the 1940 masterwork “at least four times”), this new edition of Security Analysis will reacquaint you with the foundations of value investing—more relevant than ever in the tumultuous 21st century markets.
- Series: Security Analysis Prior Editions
- Hardcover: 700 pages
- Publisher: McGraw-Hill; 6 edition (September 4, 2008)
- Language: English
- ISBN-10: 0071592539
- ISBN-13: 978-0071592536
- Product Dimensions: 9.2 x 6.5 x 2.4 inches
- Shipping Weight: 3 pounds (View shipping rates and policies)
As other reviewers have pointed out, this (sixth) edition of Security Analysis includes a reprint of the popular 1940 edition (Warren Buffett's favorite), minus some chapters. The deleted chapters, which can be found in the CD that accompanies the book, make room for (new) general introductory remarks to this edition and also to the eight major parts of the book, written by a variety of modern commentators. If all you really want is the 1940 edition, then the better choice for you is probably to buy the currently in-print reprint that's available (for a lower cost that this sixth edition). You could also buy one of the books actually printed back in 1940, but that will set you back big bucks, because original versions of Security Analysis are collectors' items today. For example, a good copy of the first printing of the 1934 edition easily runs into five figures.
Concerning the 1940 edition (or just the 1940 chapters contained in this sixth version), other than for the references to corporate examples from the 1920s or 1930s, the content is amazingly relevant to today's investing. I had read Security Analysis (the fourth edition) many years ago, and I had forgotten just how clear, precise, insightful and truly sophisticated Graham and Dodd were. Remarkably, in many instances this 1940 edition does a better job describing 21st century investing issues than the majority of material written today.
What you get with this sixth edition that's not available in the other editions are a short (two page) foreword by Warren Buffett and 10 essays by some of the most well-regarded modern investors and authors. Indeed, it was an honor to be asked to contribute to the sixth edition. The essays run about 15 pages, on average, and many of them are highly informative and useful.
This book is not a step-by-step tutorial on how to invest, but a lengthy philosophical outline of 'value investing' along with numerous real-world examples, which although they are 70 years old are still materially valid today. You will need to understand accounting and how to read financial statements before reading this book, and good experience in security analysis is also recommended. Even so, the book is lengthy and takes time and effort to read. Is it worth it? Well, it was a valuable read for me because I am serious about my investments, but for someone who just wants a quick-and-dirty guide this book is not for you.
The one big difference between the application of Security Analysis in Graham's days and now is probably the advent of cash-flow statements which makes analysing a company's true earnings easier.
Concerning the differences between this edition and previous editions, there are essays from various money managers in this edition but some rather important chapters from the original book have been removed to make room for these essays (the missing chapters can be found on the enclosed CD.) Some of these new essays are informative and well-written, others less so. Overall I would probably have preferred essays similar to those found in the updated version of Graham's book The Intelligent Investor, which were detailed modern-day analogies of Graham's examples. There are also some erroneous page references here and there in this edition of Security Analysis.
All in all, if you already have an earlier edition of Security Analysis you'll probably not find anything truly worthwhile here.
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