The book Warren Buffett has recommended the most is "The Intelligent Investor"​ by Ben Graham (2024)

The book Warren Buffett has recommended the most is "The Intelligent Investor" by Ben Graham. Here are 10 timeless principles from the book that you can use to invest better:

This is a dense book of over 500 pages, but a lot of the principles are timeless. As they say, great books have the best ROIC.

It's surprising how rapidly technology has changed while market fundamentals are still the same. Guess human nature doesn't change.

#1 There is a difference between an investor and a speculator. A speculator looks at prices. An investor understands that a business is a living, breathing entity and not just a number.

#2 An intelligent person might not be an intelligent investor. The right temperament makes a bigger difference than IQ points.

#3 Just because a business grows, it does not mean your investment will grow at the same pace. The airline industry in its early years was a great example of this.

#4 The market is like a voting machine in the short term but like a weighing machine in the long term. Prices can fluctuate wildly based on emotion, but the true value of a business will show over the years (whether good or bad).

#5 The intelligent investor's primary goal is to not lose money – and that's not easy. If you lose 95% of your money, you have to make a 1900% profit just to get back to square one!

#6 Buying even the best stock only makes sense at the right price. Always ask "How much?" before buying, like you buy your groceries.

#7 Diversify. Invest in bonds, stocks, and other assets so that your fortunes are not tied to a single bet.

#8 Always look for a margin of safety. Buy at a price where even if your calculations are off by a little, you have room to be wrong and still make money.

#9 Understand your style and commit to it. You can either be a passive investor who minimizes stress and makes good returns, or you can be an active investor who spends all your energy on finding great bargains. There is no middle ground.

#10 Your worst enemy as an investor is yourself. Three months later, you will remember NOTHING about why you started. Keep yourself accountable to your plan with a friend or family member – and stick to it!

SsF