Benjamin Graham is known as the father of value investing, and he pioneered a rigorous, quantitative approach to security analysis. Graham started investing during the early 1900s. The landscape then was very different. For example, investing was not considered a respectable profession. It was viewed more like astrology or a game of chance—run by crooks and people with inside information. Using inside information was legal at the time. His groundbreaking investment strategy had its roots in his own personal hardship.
Value investing requires analytical rigor, discipline, patience, and willingness to go against the crowd. Graham was able to follow this approach, and his investment firm posted annualized returns of about 20% per year from 1936 to 1956—roughly double that of the market.
