What is the Graham Number?
Value investing is a long-term strategy that is based on the principle of buying and holding undervalued securities. Graham number helps in discovering the intrinsic value of the stocks. If the company’s shares trade above its Graham number, they are overvalued and should not be purchased. Shares trading below the Graham number are undervalued and fit for purchase. Thus, the Graham number helps investors find undervalued stocks and saves them from paying more than their fair value.