Page 130 - Morgan Housel - The Psychology of Money_ Timeless Lessons on Wealth, Greed, and Happiness-Harriman House Limited (2020)

But he was practical. And he was a true contrarian. He wasn’t so wedded to
investing ideas that he’d stick with them when too many other investors
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caught onto those theories, making them so popular as to render their

potential useless. Jason Zweig—who annotated a later version of Graham’s
book—once wrote:

Graham was constantly experimenting and retesting his assumptions and

seeking out what works—not what worked yesterday but what works today.
In each revised edition of The Intelligent Investor, Graham discarded the
formulas he presented in the previous edition and replaced them with new
ones, declaring, in a sense, that “those do not work anymore, or they do not
work as well as they used to; these are the formulas that seem to work better
now.”

One of the common criticisms made of Graham is that all the formulas in
the 1972 edition are antiquated. The only proper response to this criticism is

to say: “Of course they are! They are the ones he used to replace the
formulas in the 1965 edition, which replaced the formulas in the 1954
edition, which, in turn, replaced the ones from the 1949 edition, which were
used to augment the original formulas that he presented in Security
Analysis in 1934.”

Graham died in 1976. If the formulas he advocated were discarded and
updated five times between 1934 and 1972, how relevant do you think they
are in 2020? Or will be in 2050?

Just before he died Graham was asked whether detailed analysis of
individual stocks—a tactic he became famous for—remained a strategy he
favored. He answered:

In general, no. I am no longer an advocate of elaborate techniques of
security analysis in order to find superior value opportunities. This was a