This was an interesting summary of some of the investing philosophies of the best investors in history: Benjamin Graham, Warren Buffett, Howard Marks, George Soros, Seth Klarman and Monish Pabrai. If you were drafting an all-star investing lineup for the past 100 years, you’d be hard pressed to build a better team.
The author explains that after researching all of these legendary investors, there was one major conclusion: they were all talking about the same thing. Sure, it was in their own way and in their own words, but at its core they were all making the case for value investing.
Value investors have underperformed their much-more celebrated growth investor peers over the past couple of decades. But that is partly because investors’ views on what value investing is in the modern age of technological disruption and intangible assets has changed. The principles remain the same: buy a dollar for 50 cents, invest with a margin of safety. But a generation ago, that meant looking at a company’s balance sheet and determining what all of its assets could be sold for and paying less than that sale price. Today, value investing is different. It asks investors to calculate the value of a business based on intangibles like network effects and intellectual property. But then still has investors buying when share prices dip below that intrinsic value.
Take, for example, Warren Buffett’s purchase of Apple in 2016. It wouldn’t have met the classic criteria of value investing outlined by Warren Buffett’s mentor Benjamin Graham. But times have changed and Benjamin Graham’s style of net-net value investing is no longer as relevant to the market today.
Styles of investing change, business practices evolve but core investing principles remain timeless. And this article is a good summary of the investing principles of some of the best to ever do it.
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