The Intelligent Investor, written by Benjamin Graham, is the definitive book on value investing. In this video series, from one to twenty four, we will supply guidance in the adoption and execution of investment policy. Still, comparatively little will be said here about the technique of analyzing securities. Attention will be paid cheaply to investment principles and investors attitudes.
Bruce Berkowitz gives his insights about what is going on the market and where is he putting his money right now. His favourite stocks are recession-proof, defense and health care, because the health care companies are generating significant amounts of free cash and they are doing their job. He says that there is nothing more important at the end of the day than health and safety of us. Health care companies are the companies that will help to improve the United States system.
In this video Warren Buffett talks about Benjamin Graham. He says that it was a pleasure for him to talk about Ben. He remembers that in 1949 he bought a copy of “Intelligent Investor”, and that book not only changed his investment philosophy, but his all life. He would have been another person living in another place without that book. It was Ben's ideas that sent him to the right path. He applied to the Columbia University where he met Ben Graham. When he finished his studies, he said to Ben that he would like to work for him for nothing, but he said that he is overpriced.
Warren Buffett talks about diversification in this video. So, he says that you should diversify if your goal is not to beat the markets and you are not an experimented investor. Most people should be invested in index funds and not trade. You need only six best ideas, few people got rich because of a seventh best idea. Warren says that he would put 50% in his single best idea. He does not diversify in his personal account.
Warren Buffett continues to talk about Coke, company that is growing a lot faster outside US than in the US. Coke started in 1919 for $40/share. A year later it was selling for $19/share. There must have been a disaster. Maybe sugar prices increased. Such things effect the short term. But if you ignored the short term, and reinvested the dividends in Coke stock, you’d have about $4,000,000 today. Warren thinks that if you are right about the business, you will make a lot of money.