Principles of Value Investing

The Intelligent Investor is definitely one of the best book for all value investors out there. It combines business philosophy, rationalization and mathematics to argue on the latent potential of value investing by Benjamin Graham.

Investing, according to Graham, consists equally of three elements:

1. A company must be analysed thoroughly along with the soundess of its underlying business before buying its stock

2. One must deliberately protect oneself against serious losses

3. One should aspire to be adequate return, provided he or she acts with reasonable intelligence

One great tip which he left regarding the purchase of stocks:

If you are shopping for common stocks, choose them the way you would buy groceries, not the way you would buy perfume. - Benjamin Graham