About the Author:

Edgar Wachenheim is the founder, chairman and chief portfolio manager of Greenhaven Associates. The fund currently manages over US$6 billion. In the 25 years since the founding of the fund in 1987, Greenhaven Associates had produced market beating returns of 19% per annum on average.

About the Book:

Unlike other books which discuss theories on stock pickings, investment principles or even investing psychology, this book adopts a case-based pedagogy.

Edgar shares details of several investments made by Greenhaven. He illustrates methodologically how each investment thesis surfaced before detailing the probabilistic approach towards assessing these theses and finally discusses how he appraises the target price of each firm in question.

Here goes the 5 takeaways:

1) The first goal of investing is to control the risks of permanent loss

Edgar shares his belief that a shareholder makes money off the income statement, but survives off the …