Security Analysis: Which edition should you read? скачать в хорошем качестве

Security Analysis: Which edition should you read?

Welcome to #individualinvestor The Security Analysis book by #BenjaminGraham is considered the bible of value investing. It packs more than 800 pages. There are 6 editions of the book, the first one written in 1934 and the last one in 2008. One question that I had myself is which edition should I read? What I ended up doing is buying both the 2nd version and the 6th version and here is why. #WarrenBuffet himself recommends the 2nd version of the book because that's the last version where the original authors, Graham and Dodd are the only authors of the book. The other editions have additional co-authors and collaborators, while the 6th edition is the most criticized they removed a total of 11 chapters from the original editions. When reading the 2nd edition, I struggled to connect the concepts of Security Analysis to today's environment as a new investor. Graham's way of pricing stocks was anchored on balance sheet and income statement analysis, with a lot of emphasis on hard assets and earnings (and therefore P/E ratios) with respect to bond yields. In today's world, free cash flow plays a fundamental role in company valuation, in combination with the balance sheet and income statement analysis as well. The nice thing about the 6th edition are the introductions and commentary to each chapter written by modern investors, which in my opinion makes up for the fact that it's missing 11 chapters from the original editions. There is also a foreword by Warren Buffet and a preface by Seth Klarman that are pretty insightful. These introductions are super useful, because they take the classic concepts from the book and apply them to recent history with many relevant examples. In summary, if you are getting started I'd recommend you get both the 2nd and 6th editions. Read the 2nd one or many times until you feel comfortable with the concepts and then read the foreword, preface and introductions from the 6th edition at the beginning of the 9 chapters. You will see how everything will make a lot more sense and how investors other than Warren Buffet have applied the lessons from Graham and Dodd's original Security Analysis. #valueinvesting