Thursday, September 3, 2009

3 principles of investing by Benjamin Graham - the guru of Warren Buffet

According to Graham, investing consists of 3 main elements:

1) One must thoroughly analyze a company, and the soundness of its underlying business, before one buys its stock.

2) One must deliberately protect oneself against serious losses - can be achieved through diversification.

3) One must aspire to "adequate", not extraordinary, performance.

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