The Investment Process by Prof. Greenwald of Columbia Graduate Business School on August 4th and 5th 2005
Transcript and Edits by John Chew at Aldridge56@aol.comstudying/teaching/practicing investing Page 1
Gabelli Value Investing Conference held at Princess Gate in London.
Professor Bruce C. Greenwald’s Lecture on an Investment Process
On Thursday August 4, 2005 in London EnglandView Lecture on the Web at:
This lecture is a thorough discussion of an
A good supplement to this lecture is the book:
Value Investing: From Graham to Buffett and Beyond
(Hardcover) by Bruce C. N. Greenwald and the book,
You can read the
by Ben Graham; you can study the bookswritten by Philip A. Fisher
these authors provide a thorough investment process. What YOU want toattempt is to carve out your own process and areas of expertise.
Buffett: The Making of an American Capitalist
by Roger Lowenstein, 1995. Page 318: Columbia’s
Graduate Business School program was less one-sided than most. It hired Wall Street pros as part-time lecturers,some of whom used a Graham-and-Dodd approach. But the finance program was, as Buffett maintained,dominated by Efficient Market Theory. A stroll through the business section of the university bookstore suggestedthat a student could get an M.B.A at Columbia without ever hearing the named Graham and Dodd, and withouteven a faint exposure to value investing. Eventually, Columbia established a Graham-and-Dodd chair, but oddlyassigned it to Bruce Greenwich. Greenwald, an MIT-trained economist had married into money, made a millionor two in bond futures, lost a similar sum in oils, and quit at the insistence of his in-
laws. ―At investing I’m acomplete idiot,‖ he noted, rather affably, adding that it was speculating that turned him on. He invited Buffett togive a guest lecture but did not think him imitable. ―I’m sympathetic to the Graham
Dodd point of view,‖Greenwald said, ―but I’m not really a Graham
IntroductionGabelli Management had its inception in 1977.Value investing
is a rational, disciplined approach to help navigate the investment world ruled byspeculation, unjust emotions, confusion and momentum. The core value is very basic: that the underlying value of financial security is measurable and stable regardless what the market does to it. The goal is to purchase securitieswhen their market prices differ significantly from their fundamental value. Value investors have been forced to bea little more ingenious in their ways of identifying, measuring and defining value. From
--the disciples of value investing are plentiful and to date no other investment methodhas proved to be more successful as professor
will go into.
Columbia Business School
has long been the house of value investing.
taught therefollowed by
who was a teacher of our founder,
Today the mantel is held by
He is considered to be a leading expert on value investing,economics of information and productivity. His recent book,
Value Investing from Graham to Buffett and Beyond
,is considered the third tome on the practice of value investing after 1934
and the 1948
. I highly, highly recommend that you read it.The more interactive these sessions are the better.
Don’t wait for the Q&A session to ask questions.