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Warren Buffett, Benjamin Graham, and the Efficient Market Hypothesis
Manage episode 503866728 series 2530563
In this episode, we dive into the investment philosophies of legendary investors Warren Buffett and his mentor, Benjamin Graham. We explore their approach to value investing, which focused on finding deeply discounted stocks. We also take a closer look at Graham's famous "net working capital" strategy, and how these methods led to Buffett's incredible success.
Benjamin Graham & Value Investing: We'll discuss Graham's focus on buying stocks at prices significantly below their intrinsic value, particularly those selling for less than their net working capital. This forms the basis of value investing.
The Efficient Market Hypothesis (EMH): We'll break down the two main forms of this theory:
Weak Form EMH: The idea that past prices and trading volume don't help you predict future prices. We'll discuss why this suggests that technical analysis (using charts and graphs) doesn't work.
Semi-Strong Form EMH: The idea that all publicly available information is already reflected in a stock's price. Warren Buffett's career, however, can be seen as a challenge to this idea, as he used fundamental analysis to achieve above-market returns.
Referenced episode Rock Paper Scissors Trading
Want more Frugal Content? Follow me on:
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Instagram: https://www.instagram.com/the_frug_life_podcast
Or sign up for our Newsletter: http://www.thefruglife.com/p/join.html
Get a free stock when you sign up for WeBull and deposit $100. Use my link below:
https://act.webull.com/i/TwIJ8klybvIo
Music Credit The Purple Planet
156 episodes
Manage episode 503866728 series 2530563
In this episode, we dive into the investment philosophies of legendary investors Warren Buffett and his mentor, Benjamin Graham. We explore their approach to value investing, which focused on finding deeply discounted stocks. We also take a closer look at Graham's famous "net working capital" strategy, and how these methods led to Buffett's incredible success.
Benjamin Graham & Value Investing: We'll discuss Graham's focus on buying stocks at prices significantly below their intrinsic value, particularly those selling for less than their net working capital. This forms the basis of value investing.
The Efficient Market Hypothesis (EMH): We'll break down the two main forms of this theory:
Weak Form EMH: The idea that past prices and trading volume don't help you predict future prices. We'll discuss why this suggests that technical analysis (using charts and graphs) doesn't work.
Semi-Strong Form EMH: The idea that all publicly available information is already reflected in a stock's price. Warren Buffett's career, however, can be seen as a challenge to this idea, as he used fundamental analysis to achieve above-market returns.
Referenced episode Rock Paper Scissors Trading
Want more Frugal Content? Follow me on:
Twitter: https://twitter.com/thefruglife
Facebook: https://www.facebook.com/TheFrugLife/
Instagram: https://www.instagram.com/the_frug_life_podcast
Or sign up for our Newsletter: http://www.thefruglife.com/p/join.html
Get a free stock when you sign up for WeBull and deposit $100. Use my link below:
https://act.webull.com/i/TwIJ8klybvIo
Music Credit The Purple Planet
156 episodes
All episodes
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