📖Benjamin Graham
Defensive vs Enterprising
Choose your investor type and build a system around it.
The defensive investor will place his chief emphasis on the avoidance of serious mistakes or losses. The enterprising investor will devote time and care to the selection of securities that are both sound and more attractive than average.
🏠 Everyday Analogy
📖 Core Interpretation
Benjamin Graham treats survival as the first objective. Limiting permanent capital loss, controlling leverage, and avoiding single-point failure are prerequisites for long-term compounding.
💎 Key Insight：Self-awareness about risk tolerance determines the right approach.
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❓ Why It Matters
A single large drawdown can erase years of progress. Risk control is not timidity; it is the operating system that keeps compounding alive.
🎯 How to Practice
Define downside scenarios before entry, cap position size, avoid fragile leverage, and maintain liquidity so mistakes remain survivable.
⚠️ Common Pitfalls
Equating volatility with all forms of risk
Oversized positions without an exit plan
Using leverage to compensate for uncertainty
📚 Case Studies
1
Holding Johnson & Johnson Through Crisis (2008)
During the 2008 financial crisis, Johnson & Johnson’s stock declined sharply with the overall market despite strong fundamentals.
✨ Outcome：An investor who focused on earnings stability and dividends, not price swings, held the stock and saw it recover and reach new highs within several years while collecting uninterrupted dividend increases.
2
Dot-Com Bust Volatility (2000)
Tech stocks collapsed after the bubble burst; high-quality firms with strong balance sheets traded at deep discounts for several years.
✨ Outcome：Accumulated shares gradually during panic and neglect, benefiting as valuations normalized over the following decade.
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