Retired principal, Graham-Newman Corp.
Benjamin Graham, the father of modern security analysis, has become an almost mythic figure to many investors for his cogent insights into fundamental analysis and value investing.
Mr. Graham has influenced generations of portfolio managers through his principals for analyzing fundamentals of a company in order to search for undervalued stocks and bonds. He popularized such concepts in investment analysis as price-to-earnings ratio, debt-to-equity ratio, book value and earnings growth, which he regarded as keys to evaluating a company. He eschewed forecasting earnings.
His investment principles were distilled in what has become a classic textbook, "Security Analysis," published in 1934, while he was a professor of finance at Columbia University. It was co-written by David L. Dodd, a colleague.
Mr. Graham further developed his principals in "Interpretation of Financial Statements," published in 1937, and in "The Intelligent Investor," published in 1949, which is a more concise and layman's version of his classic book. A new edition of "The Intelligent Investor" was published in 2003. In a preface to that edition, Warren Buffett wrote: "I read the first edition of this book early in 1950, when I was 19. I thought then that it was by far the best book about investing ever written. I still think it is."
Mr. Graham, an investor himself who became rich using his own investment insights, might be considered the world's greatest investment adviser. He taught Mr. Buffett, who enrolled in his Columbia class in 1950 and went on to become the world's greatest investor.
Mr. Graham died in his home in Aix-en-Provence, France, in 1976. He was 82.