Nice article.

He doesn't touch on one related factor that worries me a bit. He talks about how emotionally hard it is to follow a strategy that takes more years to come good, but he doesn't talk about the fact that the long delay itself may make the returns worse.

For example, say in olden times a value investor could find nice stuff at 30% off and wait maybe 4 years to get a normal valuation and a good exit. Annualized return 9.3%/yr from the value and mean reversion effect.

Let's say he is right that you can now even more extreme deals, say 40% off, but that it now frequently takes 10 years for the mean reversion investment thesis to work. That's only 5.2%/year from the mean reversion. The case for this style of investing is much weakened.

The basis of value investing could be summarized as buying something at well below fair value, then just wait for fair value in the marketplace. But as the wait gets longer and longer, the "well below fair value" MUST get more extreme too, or it erodes the whole Graham approach.

Jim