Many value investors are using the wrong investment strategy. Individuals wanting to profit from the stock market are consistently trying to become the next Warren Buffett.

They use careful analysis to find wonderful companies trading at fair prices. This investment strategy is bound to drag down long-term returns and minimize profits.

Value investors would be wise to stop thinking so hard about the stocks they buy. Evidence shows that highly simplified investment strategies provide the highest long-term results.

In 1934, Benjamin Graham and his colleague David Dodd wrote exhaustively on the merits of security analysis. Their book - amply named Security Analysis - has gone on to become one of the most influential financial publications ever written. Today, many consider it the bible of value investing.

Security Analysis dives deep into the theory of common stock investments and details how to extensively examine financial statements. It's essentially a textbook for elaborate techniques of finding superior value opportunities.

"In general, no. 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 eventually came to disregard elaborate techniques and detailed studies to select individual stock investments.

Just  before his death - after 60 years of practicing, studying, and teaching stock investing - the Dean of Wall Street no longer supported detailed security analysis. Instead, he encouraged an investment strategy which selects a diversified group of stocks with low price ratios.

It's important to note Graham's emphasis on "group results." He is clear that "expectations for individual issues" are fruitless endeavors.

Towards the end of the interview, Graham provides specifics on two of his favorite stock-selection strategies.