Talk:David Dodd/Archives/2014

Merge into Value Investing?

I Prefer that the Section, Value Investing, NOT be merged because VI has taken on many meanings. This one here is specific to David Dodd.

Initial Anon comment

Not mentioned in this article was that in 1976 Dodd said that the markets were a lot more efficient and he was in the efficient market/capm camp. That interview should be dug up and quoted. Otherwise, the article seems a little biased to be the Dodd value investors would like him to be. – (unsigned) 23 June 2006

Initial Comment by Isotope23

Article needs a good, hard edit. I removed the obit because per WP:NOT, wikipedia in not a memorial. An external link to the obit is fine... reprinting it here is not. -- Isotope23 19:28, 15 August 2006 (UTC)

Response by Eurodog, Aug 15, 2006

Dear Isotope23,

MATTER ONE (RESPONSE TO INITIAL ANON COMMENT)

Neither Dodd nor Graham ever said or implied that they were in the efficient market or CAPM camp. I'm guessing that the quote you are referring to was the one made by Graham (not Dodd) at a forum that was later published by the Financial Analysts Journal -- and subsequently misused ad nauseam. You (or your source) have (has) taken Graham's statement grossly out of context. Here's what Graham said:

I am no longer an advocate of elaborate techniques of security analysis in order to find superior value opportunities. This was a rewarding activity, say, 40 years ago, when our textbook "Graham and Dodd" was first published; but the situation has changed a great deal since then. In the old days any well-trained security analyst could do a good professional job of selecting undervalued issues through detailed studies; but in the light of the enormous amount of research now being carried on, I doubt whether in most cases such extensive efforts will generate sufficiently superior selections to justify their cost. To that very limited extent, I'm on the side of the "efficient market" school of thought now generally accepted by the professors.

Graham was responding to the question: In selecting the common stock portfolio, do you advise careful study of and selectivity among different issues?

If you read the whole interview, you will glean that Graham essentially was recommending screening for value -- using simpler techniques, rather than "elaborate" or "extensive" ones.

Misrepresentation of Ben’s statement, and there are myriad instances, is outrageously deceptive. Since bringing this to my attention, I have found that many of the same people claim Warren Buffett is also in the EMH camp. One of the key flaws of EMH is the notion that historical volatility is a proxy for risk. If, for example, the price of a stock fell 75%, an EMH proponent would find the stock unattractive because, by definition, it is risky. A value investor might consider buying it if (a) it was cheaper than its deemed worth and (b) it has little down-side left (ergo, low risk).

Jack's response

Not necessarily, volatility is measured in magnitude of movements, not in the direction of movements (although periods of high volatility usually lead to asset price tanking). So a stock price that falls 75% will not necessarily deemed volatile, it really depends on the time span that it took for such a movement to occur. And MPT does not necessarily find a volatile stock to be unattractive, it depends on what return is to be 'expected' and whether the stock offers diversification (less than 1 correlation) to other assets in the portfolio. I think you make a fairly specious argument here. It doesn't really have to be either MPT or Value investing, they both address two different issues. – (unsigned) jack, 28 December 2008 – 68.42.72.226

MATTER TWO (Response to Isitope23's Initial Comment Regarding Obits)

Granted -- the Obit section of Dodd was too scattered, but, it is a work in progress that I will finish in about 3 weeks. The obit is important because, no one on earth knows anything about Dodd's personal life. For example, there virtually is NO photo of David Dodd anywhere -- none in any publication, internet, print or otherwise. I will have a picture of him, soon. Columbia wanted to sell me one, but I refused to pay for it. Dodd's daughter, Barbara (part of the obit) is a major benefactor of the Value Investing program at Dodd's alma mater and is an integral impetus for Graham & Dodd flourishing in academic circles. Another reason Value Investing is gaining traction as a science is that, with the passing of each decade, historical data avails itself to research, fortifying the merits of Value Investing.

My druthers would be to consolidate essential parts of the obit into one or two paragraphs.

MATTER THREE (Response to Anon's Assertion that Article is Biased)

Given what we know today, the knock on EMH is light and friendly, but dead-accurate. I had considered linking the Dodd entry to several EMH criticisms that were published prior to the 1990 Nobel Prize ... but, doing so would be an invitation for a book. EMH has unfairly and wrongly eclipsed Graham & Dodd for decades. There's no slant in this entry.

Eurodog (New York), Aug 15, 2006

Second Comment by Isotope23 on Initial Comment Above

Looking back, I realize this was confusing because I didn't preface my edit with a header, but the first two lines were added by an anon editor (and I've split this out with a line). My only issues with this is that it is a bit scattered and needs some editing to tighten it up (some of these sections like the Honorary degree should just be incorporated into the narrative of his life... also it isn't overly "user friendly" to the random person with no prior knowledge of Dodd coming across this article) as well as the fact that the obit section is not suitable. While I understand your reasonings for wanting to include the obit, but WP:NOT is very clear on the fact that Wikipedia is not a memorial. Beyond that, Wikipedia is not meant to be a primary source; if "no one on earth knows anything about Dodd's personal life" then it is not the place of a Wikipedia article to be publishing this information. Additionally, this is an article about Dodd, not his daughter Barbara or any of his other next of kin. A brief mention of her role as an impetus for Graham & Dodd flourishing in academic circles would not be out of place perhaps, but remember that this should be focusing on Dodd, not on any external persons' accomplishments. I will say I'm not a huge fan of bio's that list out every single one of a person's children, siblings, spouses, and associates. This is encyclopedia, not a biography... that level of detail is rather unnecessary and should be illustrated with an external link or bibliographical reference to the information rather than just reprinting it here.--Isotope23 18:26, 16 August 2006 (UTC)

Removed section by Isotope23

Is there a way this could be worked into article text? Right now this section makes no sense and does nothing to explain the relevance of these entities to David Dodd.--Isotope23 17:58, 17 August 2006 (UTC)

Vice Chairman Profit Sharing Plan of below companies (1960)

• Criterion Insurance Company (part of GEICO)
• Government Employees Insurance Company (GEICO)
• Government Employees Life Insurance Company (now part of Legal & General Group Plc)
• Government Employees Corporation (now part of GEICO)
• Government Employees Variable Annuity Life Insurance Company
• Government Employees Financial Corp. (part of GEICO)

Second Response by Eurodog, Aug 18, 2006

Dear Isotope23,

Your comments expose weakness in how I presented portions of the write-up; 'tho', sometimes I feel like I'm writing a fast-food entry for McDonald's.

Part of my motivation to include comprehensive information on Dodd is due to the fact that very little exists on the net. Wikipedia now shows the " Dodd side of Graham & Dodd. Most sources mention Dodd only as sort of a surname or sidekick for Graham. Wikipedia gives us a closer look at Dodd, who, with Graham, played a major role in fathering a long-standing, legendary investing institution. And, Dodd mentored some of the most successful portfolio managers in the world, including the second richest man in the United States, Warren Buffett. The world knows Graham & Dodd ... and the world knows Benjamin Graham, individually ... but few know David Dodd, individually.

One reason that his chairmanships are highly significant is that most of those companies became the signature-platform investment vehicles that made Buffett rich through ownership by Berkshire Hathaway. This factoid, among several other things, makes Wikipedia the only source -- as opposed to the primary source. By comparison, Buffett's entry is far more comprehensive than Dodd's.

The point of singling-out Dodd's Honorary Degree was that it was a major event ... one that marked the 50th Anniv of his Book; and it came two years before the Nobel was bestowed upon a trio of scholars (1, 2, & 3), all pioneers in MPT -- a rivaling view of finance, markets, and securities. The Honorary Degree was one of the few major acknowledgments for his life's work. One might view it as an ironic metaphor for how an enduring, simple school of investing takes a back-seat to a complex one, full of flaws. Like the Nobel, an Honorary Degree is less of a personal achievement; and more of a public recognition.

What I will do -- when I return from vacation in three weeks -- is attempt to connect the dots. Some of this information will soon be difficult to find because many of Dodd's colleagues are getting up in years and some have died. He has a daughter, living in the Bay Area.

Eurodog (New York), August 18, 2006

• Comment, that fast food entry isn't so far off the mark in a way. The point of an encyclopedia is to be a concise starting point for someone to get an overview on a topic and it should be easy for the average reader to understand. I'll leave this article alone until you return to make your changes.--Isotope23 12:12, 20 August 2006 (UTC)

Rather than making Wikipedia the only source for some information about Dodd, it would be more appropriate to write up your own article about Dodd and post it elsewhere on the internet. Then let other Wikipedians use it as a source, because you should not cite your own work. This would be more in line with Wikipedia standards. --JHP 02:57, 29 March 2007 (UTC)

This is supposed to be an article about David Dodd, not about value investing

This article is supposed to be about David Dodd, but the majority is actually about value investing vs. MPT. The stuff that is not specifically about David Dodd should be moved to the article on value investing. --JHP 02:43, 29 March 2007 (UTC)

Absolutely. And it's highly POV technical analysis also. I've pruned it. Pleclech 12:41, 15 April 2007 (UTC)

Respectful Suggestion to Pleclech & JHP

Endure my humble screed: Value Investing vs. MPT defined the life of David Dodd. And for 40 years, Dodd lived in the shadow of MPT. It was not until the 90s that the world began revisiting Graham & Dodd's work (check out all the books written on Value Investing from 1921 to 1990, then compare the number to those written in the last 17 years). By pruning the article, all significance is lost. Because Value Investing has myriad variations, it is preferable and appropriate to give insight on Value Investing as it relates specifically to Dodd. I contributed the article because very little information on Dodd is available. I tried to email both of you on your "POV" "technical analysis" assertions ... but your usernames had no "sender email addresses." I acquired much of this information in grad school from readings and professors at Columbia and Yale. The Nobel Laureate recipients themselves behind MPT now openly acknowledge holes. What you seemingly refer to as POV became FACTUAL when data became available as the theories and practices matured. MPT is 50-60 years old. Value Investing is 85 years old. The validity of both schools rests upon data over time, which, from a statistical perspective, is perhaps relatively insufficient. Anything is POV if you disagree or don't know. In the professional world of investing and portfolio management, Europe seems to hold high regard for MPT. But, Americans have moved on (success of Buffett, et al., inspired new research and review). Holes notwithstanding, investment managers in the U.S. still use MPT (volatility ... betas ... alphas ... efficient frontiers ... capital asset pricing model) as a management tool, but only because there is no other way to manage billions (the last sentence is a POV). It's not so much that MPT is flat wrong (there's nothing wrong with precisely knowing MPT metrics), but rather that MPT does not live up to its initial billing of helping investors manage risk and make money. MPT has become a little like the price-to-earnings ratio ... it doesn't mean a damned thing, but you still have to know it. Same with technical analysis, something that most investors liken to tarot cards.

Jack's response

MPT never claimed to help investors MAKE money. That was never the intention. MPT was simply an attempt to quantify a relationship between risk and return, and make explicit the advantages of diversification in terms of reducing 'risk' as defined by standard deviation. Or perhaps you missed the point that CAPM/MPT made, which was that most investors would be better off holding the market portfolio and bonds. Which is generally sound reasonable advice, compared to what 90% mutual funds have historically obtained. Now I understand that you feel passionately about this so called debate between MPT and value investing, but perhaps the two aren't mutually exclusive. I for one believe there are insights to be had from both. I am inclined to agree with you on EMH, it is one of those theories that uses circular logic, it simply can't be disproved (in some people's minds anyway) because the so-called equilibrium price can never be observed in any point in time. – (unsigned) jack, 28 December 2008 – 68.42.72.226

I have scoured the Internet, libraries, Columbia University archives, public records, vital records, and the like ... there is very little out there on Dodd. Whatever the editors prune will be gone from the world. Perhaps Wikipedia is not a safe or appropriate place to contribute powerful albeit obscure facts. – Eurodog, July 5, 2007

External Link to Book Commentary

Suggest adding an external link section with a link to chapter-by-chapter summaries of Dodd's famed Security Analysis. This link is included on the co-author's page (Benjamin Graham), therefore it makes sense to have it here as well.--Skarsa72 (talk) 19:09, 15 August 2008 (UTC)

• As long as it isn't to barelkarsan.com, which you've been spamming over various unrelated articles lately. Themfromspace (talk) 19:15, 15 August 2008 (UTC)

Value investing editorial

It seems like the meat of this article is about value investing, what Dodd produced but not actually about Dodd. The two timelines at the end are vastly more biographical, and have the info I was looking for when I came to this article.

I could bake a cake, and there could be articles written about that amazing cake and how many people ate the cake, but that would say nothing about me - how I grew up, where I went to school, where my parents came from etc. This article lacks the latter. Compare this article to Bill Gates, which actually focuses on the person and less on what he produced. —Preceding unsigned comment added by 68.42.72.226 (talk) 08:06, 28 December 2008 (UTC)