The Intelligent Investor is a classic guide to value investing that emphasizes discipline, analysis, and long-term thinking rather than market prediction. It asks readers to separate price from underlying value, insist on a margin of safety, and judge investments by fundamentals instead of market noise. The revised edition adds commentary and annotations by Jason Zweig, linking Graham’s principles to modern markets. A central framework is choosing whether you are a defensive or enterprising investor and building a portfolio policy that can hold up through market fluctuations. It encourages patience and consistency, aiming for adequate returns while reducing costly mistakes. This summary reflects the revised edition with ISBN-13 9780060555665.

Key Concepts

  • Value investing focuses on intrinsic value rather than short-term price moves.
  • Margin of safety is the central protection against error.
  • Defensive vs enterprising investors choose different effort levels and portfolio policies.
  • Market fluctuations and Mr. Market should be treated as optional price offers.
  • Determining value relies on fundamental analysis and long-term business strength.

Top 3-5 Takeaways

  • Choose your investor type and write a policy; for a defensive approach, use a diversified core and rebalance on a simple rule (e.g., annually or when allocations drift 5%).
  • Require a margin of safety before buying; estimate value and only buy when price is meaningfully lower (e.g., at least 25% below your estimate).
  • Treat market swings as opportunities; pre-plan add or trim rules (e.g., add after a broad drop, trim after a big run-up).
  • Use a fundamentals checklist; review earnings stability, balance sheet strength, and dividend record before you buy.

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