Security Analysis Book Pdf


Security Analysis is the most comprehensive investing book ever written, an all-time bestseller and Warren Buffett has repeatedly praised his investment success and valuation skills he gained through the book. Security Analysis outlines three key concepts:

What is the difference between speculating and investing?

How much money is the company really making?

How can the balance sheet reveal the truth about a company?

Security Analysis Book Pdf

Security analysis helps in finding which securities are good investments. Real investments will keep the principal safe. They’ll also give good returns. Hence, anything which doesn’t do this is speculation.

Click here to download Security Analysis Book Pdf 

There are three functions of security analysis:

1.    “Descriptive function” – This compares different securities. Plus, it smartly outlines facts.

2.     “Selective function” – It helps judge if an investor must sell, buy or hold a security.

3.     “Critical function” – This observes management, company policies, and structure regularly.

Market analysis is different than securities analysis. It tries to predict the prices of individual securities. It doesn’t consider the core facts of different firms. Technical analysis is a form of market analysis. Under this, future values are predicted by seeing old market values. These activities influence security prices to some level. None of these market analyses have proven effective. Both mainly promote speculation.

Internal value is a crucial concept in security analysis. But, it’s also a vague concept. It’s a value justified by facts. These include earnings, assets, dividends, etc. Such facts are then manipulated artificially. Investors can’t measure the exact intrinsic value of a security. This is because there’re many variables involved. But, careful analysis can help find if the price quoted by the market is proper. Securities should pass safety tests to be profitable investments. Also, they must sell below their internal value.

 Click here to download Security Analysis Book Pdf