FIXED INCOME INVESTING - BY BENJAMIN GRAHAM

I came across an interesting article on "fixed income value investing". A larger part of this text has been taken from Benjamin Graham's popular books - Security Analysis and The Intelligent Investor.

Two paragraphs I particularly liked :

1. "It's our argument that a sufficiently low price can turn a security of temperance quality into a sound investment opportunity - provided that the buyer is informed and experienced, and that he practices adequate diversification."

2. On the topic of diversification, Graham makes an interesting connection between investing and insurance. He notes that any individual security purchase may not prove profitable, even if the margin of safety is present at the time of purchase.

Graham says, "The margin guarantees only, that he has a better chance for profit than for loss - and not that loss is impossible. But as the number of such commitments is increased the more certain does it become that the aggregate of the profits will exceed the aggregate of the losses. That is the simple basis of the insurance under-writing business."

YOU KNOW WHAT WARREN BUFFET SAYS ABOUT OBAMA......? READ THIS

This is what he says and I am quoteing this from one of media reports---

As the President-elect Barack Obama gets all set to walk into the Oval Office as the 44th President of the United States of America now more than 24 hours, Warren Buffet, Chairman of Berkshire Hathaway and Kirby Daley, Senior Strategist of the Newedge Group, comment on Barack Obama and the challenges he will have to deal with as the president.

Warren Buffet said, “He's the absolute right Commander-in- Chief. That's another thing American people seem to do is we elect people that are right for the times, whether it was Lincoln or Roosevelt, you could not have anybody better in charge.”

Buffet added, “He's smart, got the right values, but he also understands our economics very well. He's cool, he's analytical, but then when he gets it all thought through he can convey to American people what needs to be done. Not to expect miracles, that is going to take time. But we are going to get to the other end.”

Even Kirby Daley said, “It will be a great speech. This guy is nothing if he isn’t a walking-talking speech machine.” Daley added, “He has built up so much hope in this nation. This speech is going to be of massive importance. What he should do and what he's going to do are two very different things. He should walk out there and he will go down in history if he prepares the country for what is inevitable and what is coming and that is severe belt tightening.”

BUY IT LIKE BUFFETT

Remember the words of the great investor of the times Mr. Warren Buffet, here I have tried to quote some of his words as he quotes --

“I feel like an oversexed guy on a desert island. I can’t find anything to buy.”

– Warren Buffet, 1973

“I feel like an oversexed man in a harem. This is the time to start investing.”

– Warren Buffett, 1974

Which Warren Buffett should investors follow today?

Based on some of his public quotes and opinion, the Oracle of Omaha has made only three boldly positive market calls in his career; the latest one was on Friday.

The first two calls were prescient.I hope he proves himself again, but for the Indian Market yes it is time to put not all but an proportion of ur funds into the markets once it comes near 8,500 levels.

*Please contact ur financial advisor before investing, the author does not take any responseablity of any kind.