Tweedy Browne comes to mind as closest to Graham currently among the institutions. Since 1983, Graham's methods would seem to have failed us. No doubt. It would be difficult to operate purely on Graham's relatively simple methodology in this day and age, especially as an institutional player. All the best-performing Graham values in the last few years tend to be illiquid with either small floats or small market capitalization. >1 billion market cap pretty much rules out the possibility of a Graham value of late. So it may be hard to find big-name players doing well with Graham, and it is indeed hard to find it even among individuals. As a result of my journalism, and contributions to internet discussion groups, I've developed e-mail contact with hundreds of investors, and I count just three successful Graham investors among them, just one of whom uses it exclusively. And if I count myself among those three, then maybe I shouldn't since I do tend to look for Tweedy's variation of Graham, which includes insider buying after a significant fall in price usually greater than 50%.
When I started this thread, I took "in the Graham tradition" to mean "let's stay away from PEG's." So we end up with our variations on the theme of value investing. Great discussion of late. With financial analysis-challenged people I know still buying houses and sports cars with their stock market winnings in Microsoft, Cisco, and now some of the internet stocks, it's hard to argue or even defend value investing at the neighborhood barbeques. Good to see it still generates interest out here in cyberspace. |
