CFA Institute Blogs
What do quant great Edward O. Thorp, behavioralist Jamies Montier, and value investing legends, Benjamin Graham and Warren Buffett, have in common? These investment practitioners all make a seemingly incongruous appearance together in Quantitative Value, a new book by Wesley Gray and Tobias Carlisle. Read more
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As we come upon the close of the first quarter of 2013, most major equity indices around the globe are showing impressive gains, buoyed by continued monetary easing by central banks and hopeful signs of economic resurgence. While investors will likely look for confirmation in upcoming earnings reports, the recent negative preannouncement from economic bellwether FedEx (FDX) should serve as a reminder that profit margins are near all-time highs and could represent a significant hurdle for stocks. Read more
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Today’s historically low interest rates and investors’ flight to safety have combined to raise interest in dividend-paying stocks. And while studies of the efficacy of dividend-investing strategies have been mixed, dividend investing remains a popular strategy. As such, it only seems appropriate to revisit an investing classic that first provided investors with a theoretical framework for determining the intrinsic value of stocks based on their dividends: John Burr Williams’s The Theory of Investment Value. Read more
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Top posts from last month included articles on JPMorgan Chase’s $2 billion loss, recent 13F filings, and the opportunities in frontier markets. Read more
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Investors who bought shares in the recent public offering should have first consulted the authors of Security Analysis, who wrote that the intrinsic value of a security is “that value which is justified by the facts . . . as distinct, let us say, from market quotations established by artificial manipulation or distorted by psychological excesses.” Read more
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The roots of value investing can be traced back to the 1934 publication of Benjamin Graham and David Dodd’s classic, Security Analysis. Graham later disseminated his views to the general public in the highly regarded book The Intelligent Investor. The influence of Graham’s methodology is indisputable. His disciples represent a virtual who’s who of value investors, including Warren Buffett, Bill Ruane, and Walter Schloss. As a measure of his enduring impact on the field, a search of “Benjamin Graham” on Amazon.com yields more than 900 results concerning Graham’s writings and works about his investment philosophy. Given the success of the master and his students, it is no wonder that Graham remains an investor of immense interest to practitioners. Read more
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