The best investment you can make is in yourself.
-Warren Buffett
The most successful individuals, ranging from Bill Gates to Mark Cuban have always been avid readers, and deeply value learning. It is no secret that the greatest investor in the world, Warren Buffett alongside his partner, Charlie Munger spend the majority of their time reading and thinking. In fact, Buffett contributes a lot of his success to reading, picking up a book at the Columbia library led to a chain of events that forever changed his life. Reading has numerous cognitive benefits; it can improve knowledge, intelligence, increase abstract thinking and creativity.
I constantly see people rise in life who are not the smartest, sometimes not even the most diligent, but they are learning machines.. they go to bed every night a little wiser than they were when they got up.
-Charlie Munger
Here’s a list of 10 must-read investing books:
1. The Intelligent Investor by Benjamin Graham
Benjamin Graham is regarded as the father of value investing. His contributions on margin of safety and financial analysis paved the road for investors. This book has heavily influenced Warren Buffett’s life and is considered one of the bibles of value investing. “Chapter 8 and 2 have been the bedrock of my investing strategy for more than 60 years years. I suggest that all investors read those chapters and reread them every time the market has been especially strong or weak” – Warren Buffett
2. Security Analysis by Benjamin Graham and David Dodd
Graham and Dodd’s Security Analysis is the foundation of The Intelligent Investor. It is widely regarded as the fundamental textbook for analysis of stocks and bonds. It explores numerous topics on analysis of balance sheets, intrinsic value, margin of safety, fixed securities and much more. Many of the greatest financial figures were fascinated by this book, notably Warren Buffett, Jamie Dimon and Seth Klarman. This is an absolute must-have for every serious value investor. Find it: here.
3. A Random Walk Down Wall Street by Burton G. Malkiel
Burton G. Malkiel explores numerous investing topics such as the efficient market hypothesis, castles in the air, “smart” betas, risk management and low cost indexing strategies. It is captivating from the start and the author provides actionable investing plans for individuals in different age groups. Find it: here.
4. The Most Important Thing Illuminated by Howard Marks
With brief segments from his valuable memos, Howard Marks describes the components of successful investing and discusses the mistakes that investors often make. Through 20 important sections (21 including the conclusion), the author emphasizes “second level” thinking, price in relation to value, conservative investing, and numerous crucial factors for successful investing. Additionally, this book includes commentary from four famed value investors, notably, Seth Klarman, Christopher C. Davis, Paul Johnson, and Joel Greenblatt; making it one of the most important books an investor should own. Find it: here.
5. You Can Be A Stock Market Genius by Joel Greenblatt
Joel Greenblatt, successful manager at Gotham Capital explores numerous uncommon investment strategies such as spin-offs, restructuring, bankruptcies, warrants, options and mergers. He explains each strategy exceptionally well, and structures the book so it is easy to follow. Additionally, the case studies in every chapter make this book all-the-better. There are many hidden opportunities in investing, this book will definetly shine light on where to look. Find it: here.
6. Value Investing: From Graham to Buffett and Beyond by Bruce Greenwald, Judd Kahn, Paul D. Sonkin and Michael van Biema
If you ever want to learn the basics of value investing, this is it. Relatively easy read, so just about anyone can pick this up. The book consists of three parts, this includes an introduction to (I) value investing, (II) three sources of value, and (III) value investing in practice. This book provides a wonderful application of the three sources of value (part II) with a case study of WD-40 and Intel, explaining in detail the valuation process. In addition, it profiles 8 of the very best investors, from Graham to Buffett, to Edwin and Walter Schloss and beyond. Find it: here.
7. The Essays of Warren Buffett: Lessons for Corporate America by Lawrence Cunningham
This book is a reorganized compilation of letters from the Oracle himself. Buffett addresses numerous business and investing issues with his personal memos to his Berkshire Hathaway partners every year. The memos are organized to cover specific subjects such as finance and investing, investment alternatives, mergers and acquisitions, valuations, in addition to a numerous financial topics . Buffett’s investing prowess is so great that it takes the spotlight away from his immensely kind and humble character. After reading this book, you will definetly gain an appreciation for his kindness and contributions to the world and infinitely more important, gain a vast array of business and investing knowledge. What better way to learn business and investing than from Warren Buffett himself? A must-read for all investors. Find: it here.
I am a better investor because I am a businessman, and a better businessman because I am an investor.
-Warren Buffett
8. Common Stocks and Uncommon Profits by Philip A. Fisher
Known as a pioneer of Growth Investing, Philip A. Fisher’s contribution to the investing world will not be forgotten. In this book, consisting of 3 parts, he lays out the a general description in what to look for in stocks, and when to buy. He opens the book with his concept of “Scuttlebutt”, then puts in 15 detailed points to look for in common stocks, as well as 10 investor don’ts. In the second part, Fisher outlines his 4 dimensions in which he describes cues to look for in companies. He notes the importance of employees and management, investment characteristics of certain businesses, conservative investments and much more. Fisher closes the book with his philosophy along with its evolution that has made him one of the most influential investors. Find this book: here.
9. Strategic Value Investing: Practical Techniques of Leading Value Investors by Stephen M. Horan, Robert R. Johnson and Thomas R. Robinson
Strategic Value Investing explores the main strategies and valuation techniques in value investing. It consists of three sections: (I) An introduction to value investing and the how to analyze companies, (II) The valuation methods such as Dividend Discount Models, Free Cash Flow Models, Residual Income models, and more, (III) The application of the models, variations of value investing styles. The information is very practical (includes case studies) and detailed, and it emphasizes on core value investing principles such as margin of safety. Different valuation methods are a must-know for investors and the authors do great work shining light on them. A must-read if have not. Find it here.
10. One Up on Wall Street by Peter Lynch
Peter Lynch is without question one of the greatest investors of all time. He is famous for managing the Fidelity Magellan fund from $14 million to $20 billion in 1977 to 1990, greatly outperforming the benchmarks. One Up On Wall Street is filled with investing knowledge and where to search for what the author calls “tenbaggers” (10x your return). Lynch shares his views on the requirements of picking a winner, six categories in which stocks are grouped, in addition to long term aspects. Lynch makes this an easy read with his intriguing and lesson-filled stories, perfect for new investors. Find it: here.
Other mentions include The Manual of Ideas by John Mihaljevic, Margin of Safety by Seth Klarman and The Alchemy of Finance by George Soros.
Happy reading 🙂
The best thing a human being can do is to help another human being know more.
-Charlie Munger
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