For the beginner, the investing world can be terrifying. The stock market can be challenging to understand at first and while there are thousands of resources out there designed to help, separating out the best advice is often harder than picking your first stock.
There are hundreds of books out there on the topic of investing. In my experience, most of these texts are useless as they just repeat the same issues over and over again with no new insight.
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With this being the case, in my opinion, the best-known books such as the Intelligent Investor, The Snowball: Warren Buffett and the Business of Life, Common Stocks and Uncommon Profits and Margin of Safety continue to be by far the best resources on the topic of investing.
As well as these foundation style books, there are a number of newer texts that in my opinion provide invaluable insight into the world of value investing. Here are five that are currently on my bookshelf.
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Five Value Investing Books
Most books on Warren Buffett concentrate on his investment style and career. This book by Yefei Lu takes a different approach by studying 20 of the Oracle of Omaha’s investments.
The book starts with Buffett's interest in the Sanborn Map Company in 1958 and tracks nineteen more of his major investments in companies like See's Candies, the Washington Post, GEICO, Coca-Cola, US Air, Wells Fargo, and IBM. These case studies shed light on high Buffett’s investment process has evolved, and what he looks for in an investment.
Compiled with the help of Lawrence A. Cunningham, this book outlines the attributes displayed by the market’s highest qualities companies. Once again, this is a book built on case studies so if you’re looking for a ‘how to guide’ this isn’t it, but it will help you build a checklist for evaluating high-quality businesses.
Not strictly a value book, Dear Chairman is an in-depth look at some of the greatest activist battles in the history of Wall Street. This is another book built on case studies, which provides excellent insight into the world of activist investing. This book also opened my eyes to the scale of corporate mismanagement that’s out there and how important it is to be able to trust management to act in the best interests of investors.
Guy Spier’s Education of a Value Investor is well-known in the value community, but I believe it deserves a place on this list because every investor should read it. The book covers Spier’s development as an investor, away from Wall Street, to Switzerland where he can invest without the noise of the rest of the market. At the heart of the tale is Spier’s desire to refine his investment process to something that suits his style -- something every investor should aim for.
A large part of value investing is being able to invest against the crowd and hold through thick and thin. Daniel Crosby’s The Laws of Wealth tackles the subject of investing psychology in a simple and informative way, presenting case studies to back up points. Unlike other books on the subject, which can be a struggle to read, this book gets the message across in a straightforward, engaging way.
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