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Strategies & Market Trends : Graham and Doddsville -- Value Investing In The New Era -- Ignore unavailable to you. Want to Upgrade?

To: Freedom Fighter who wrote (988)	11/12/1998 8:11:00 PM
From: Berney	Read Replies (1) \| Respond to of 1722

Wayne, Let's go to the authority on the issue. In TII, Graham states (page 95): "Since common stocks, even of investment grade, are subject to recurrent and wide fluctuations in their prices, the intelligent investor should be interested in the possibilities of profiting from these pendulum swings. There are two possible ways by which he may try to do this: the way of timing and the way of pricing. By timing we mean we mean the endeavor to anticipate the action of the stock market--to buy and hold when the future course is deemed to be upward, to sell or refrain from buying when the course is downward. By pricing we mean the endeavor to buy stocks when they are quoted below their fair value and to sell them when they rise above such value. A less ambitious form of pricing is the simple effort to make sure that when you buy you do not pay too much for your stocks. This may suffice for the defensive investor, whose emphasis is on long-pull holding; but as such it represents an essential minimum of attention to market levels." Elsewhere Graham states (p 98): "We are convinced that the average investor cannot deal successfully with price movements by endeavoring to forecast them." In fact, in numerous references, he refers to the act of trying to forecast price movements (market timing) as speculating. So says the Master.