From the introductory to: CHAPTER I - SECURITIES AS INVESTMENTS Purposes of Investment Investment funds are accumulations from business prosperity or successful speculation. The desire in investing these funds is to conserve principal and by putting it to work to improve one's income. Therefore, investments are made primarily for the return they give and not for profits. For example, if any individual who has accumulated, let's say, considerable money, decides to use $10,000 in a conservative fashion, he would not think of allowing it simply to lie in a bank at a low rate of interest. If vigorous and forward-looking he would desire that such accumulated funds should earn a good return with safety. During recent years his attention would have turned to the low prices for long term investment securities. He could, for example, have purchased $10,000 West Shore Railroad First Mortgage 4's, 2361. In doing so he would have had an absolute first mortgage on a railroad property that would give him an annual return on his money of 5 1/2% or an annual income on an investment of $10,000 of $550. It is this annual income that interests him primarily. The question of whether the market price of his investment purchase is four or five points lower than six months previous, or will be four or five points higher six months later, is not of prime importance. It is in this way that investment differs from speculation. We must grasp this difference immediately. Speculations are made absolutely for profit. Investments are made primarily for income. While the desire to improve or at least maintain the principal of an investment must always be present in order to have the investment successful, the primary purpose is to bring in additional income....