About

This project began in late 2006 when I was approached by an editor at McGraw-Hill about putting together a new edition of Security Analysis. I agreed to take on this project as lead editor, and over the months that followed, we assembled a team of three additional editors: a prominent financial writer and historian, a leading value-investing academic, and an experienced financial journalist. We also had modernday practitioners comment on the original text, thereby providing a fresh perspective based on their own approaches to value investing. We added a new essay on global value investing.

Because these contributions were submitted and edited during the second half of 2007 and early 2008, you will not see references to the deepening credit crisis and sharp financial market sell-off that very nearly bankrupted the venerable investment bank Bear Stearns in March 2008. The reason is that instead of focusing myopically on very recent developments, we took a long-term view that would be applicable in both good markets and bad, and, like Graham and Dodd, we concerned ourselves chiefly with “concepts, methods, standards, principles, and, above all, with logical reasoning.”

We decided to base this sixth edition on the second edition of Security Analysis, published in 1940, because it was the most comprehensive edition, and we also decided not to alter the text of this classic work. By proceeding in this fashion, we hope that readers will gain both an appreciation for the magisterial accomplishment of Graham and Dodd in their exact words as well as insight into what is still relevant and important even in today’s vastly changed world.

This project has brought together 11 contributors in a collaboration that is emblematic of the nature of the value-investing community. Many of us are business rivals, but we are also friends and colleagues. All of us know that no one of us possesses all the answers; we vividly remember our biggest mistakes as if they happened yesterday. Similarly, we recognize that none of us has perfected the art of value investing; there are always new challenges, and there is always room to improve. By assembling the diverse perspectives of these experienced and able contributors and editors, we hope to make this sixth edition of Security Analysis a rich, varied, and highly informed tapestry of investment thinking that will be a worthy and long-lived successor to the five preceding editions.

Seth A. Klarman
Lead Editor
May 2008