Financial History Issue 133 (Spring 2020) | Page 27

ROGER F. MURRAY
The Bridge between Benjamin Graham
and Modern Value Investing
By James Russell Kelly
Almost everyone knows of Benjamin Gra-
ham, the founder of fundamental security
analysis, known today as value investing.
But very few people know of Roger F.
Murray, the Columbia Business School
professor who took up the academic torch
of security analysis at Columbia when
Graham retired. Murray taught an entire
generation of students from 1956 to 1978,
including many highly successful inves-
tors, such as Mario Gabelli, Leon Cooper-
man, Chuck Royce, Art Samberg and
Glenn Greenberg.
I took his Security Analysis course in
1968, during the peak of the Vietnam
anti-war protests at Columbia Univer-
sity. More than 50 years have passed, but
Professor Murray and his course are still
vividly in my mind. Great teachers make
those kinds of impressions.
Murray was 5'10", very thin, and always
formally dressed in a vested dark suit,
white shirt and tie with his Phi Beta Kappa
key proudly displayed. His teaching style
was also formal, which was the standard at
that time. In contrast to his lecturing style,
he was a friendly, welcoming mentor: I
met with him several times after class as
well as after graduation to seek his advice.
He was a tough grader, however. Leon
Cooperman recalls a paper he wrote com-
paring financial ratios over 20 years for
Burlington Industries and J.P. Stevens.
Murray carefully checked each ratio and
spotted only one transposition, which he
highlighted for correction.
His lectures emphasized compre-
hensive analysis of financial statements
starting with the balance sheet, primarily
using ratio analysis. The objective was
very basic—to determine a company’s
intrinsic value, which he defined as “the
Roger Murray (right) with Mario Gabelli.
true underlying central tendency in the
valuation of an enterprise.” A margin of
safety exists if the intrinsic value materi-
ally exceeds the market price. Pure Benja-
min Graham!
A major recurring theme in his lectures
was the rapidly growing importance of
pensions in society. To a group of youth-
ful students, retirement was not exactly
a captivating topic. Little did we know
about Murray’s prominent role in the
development of pension fund investing
at the College Retirement Equities Fund
(CREF), or in the passage of the Keogh
Plan and Individual Retirement Account.
Personal History
Roger F. Murray II was born on October
11, 1911, the son of Walter Fletcher Mur-
ray (1874–1947) and Mary Campbell van
Horne (1883–1960). The Murray family
lived one mile south of Columbia Uni-
versity, at 316 West 95th Street, between
Riverside Drive and West End Avenue on
the Upper West Side of Manhattan.
Murray’s father, Walter, was a suc-
cessful insurance broker who co-founded
a company with his brother, Roger F.
Murray I. RF Murray & Bro. Insurance
was located at 8 Broadway in the Finan-
cial District of Lower Manhattan. The
company specialized in fire, marine, life,
accident and other lines of insurance. This
may explain Murray’s interest in pension
funds throughout his career.
He had two older sisters, Grace (1906-
1992) and Mary (1910-2000). Grace Mur-
ray Hopper, a Ph.D. graduate in math
at Yale University, was a pioneer in the
field of computer science and program-
ming. She helped to develop MARK-1,
the first electro-mechanical computer
in the United States; UNIVAC, the first
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