Ten Books To Improve Your Portfolio
by Maynard Paton of The Motley Fool
by Maynard Paton of The Motley Fool
A great way of improving your portfolio's performance is to buy good books on investing. There are zillions of publications out there, but the following ten books should really feature in every investor's library. They cover a variety of investment topics, offer sound guidelines on how to approach the market in a sensible manner and should help build a rewarding portfolio.
- The Intelligent Investor
'By far the best book on investing ever written' claims Warren Buffett. Originally published in 1949, it's admittedly not the easiest of reads, but Benjamin Graham's tome remains the definitive guide to value investing. Chapter 8, 'The Investor and Market Fluctuations' and Chapter 20, 'Margin of S Concept of Investment' are seminal works that every budding Buffett must absorb.
- One Up on Wall Street
If novice stock pickers were to buy just one book, it ought to be Peter Lynch's One Up On Wall Street. Lynch relays his proven investment talents into a punchy, no-nonsense, but light-hearted read. Brimming with straightforward stock market advice, anecdotal stories and many famous investment quotes, Lynch explains how to 'kick the tyres' and find small-cap growth stocks that evolve into ten-baggers.
- The Investor's Anthology
Stock market connoisseurs can't afford to be without this Charles Ellis classic. It's a collection of writings from the likes of Sir John Templeton, John Maynard Keynes, Philip Fisher, Adam Smith and Philip Carret. Ellis's own chapter on the Loser's Game is probably worth the cover price alone. Warren Buffett said 'every investor will benefit from the classics found in this volume' and he was right.
- A Random Walk Down Wall Street 8e Rev & Updated
Whether you favour fundamental analysis or technical analysis, Burton Malkiel eloquently makes his case for throwing darts at the FT instead. Random Walk reviews the numerous strategies and theories used by professional investors -- and their results -- to present one of the best adverts yet for index trackers. If your investments are lagging the market, Malkiel will put you back on track.
- Extraordinary Popular Delusions and the Madness of Crowds
Would you buy into 'a company carrying on an undertaking of great advantage, but nobody to know what it is'? Many did during the South Sea mania of the 1720s. Markets have always been prone to the madness of crowds and the tech boom showed the lessons still have to be learnt. For those wishing to avoid the next delusion, Charles Mackay recounts the colourful events of the Mississippi Scheme, Tulipmania and the South Sea Bubble in flamboyant prose.
- Interpreting Company Reports and Accounts
The gold standard text to evaluating annual reports. Not a light read, but Alan Sugden, Paul Gee and Geoffrey Holmes lead you through the basics of financial reporting and every nook and cranny of a company's accounts. The book reveals a myriad of bookkeeping danger signs and, after being re-published last year, covers all the latest accounting conventions. Post-Enron, few investors can afford to be without it.
- Where Are the Customers′ Yachts? or A Good Hard Look at Wall Street
Probably the funniest book about the stock market, even though most have suffered from the follies Fred Schwed cheerfully illustrates. Some sixty years on, the jovial observations of how the investment industry continues to charm money from the hapless punter sadly remain all-too familiar. "The burnt customer certainly prefers to believe that he has been robbed rather than that he has been a fool on the advice of fools". True in 1940, true now. A gem.
- The Global-Investor Book of Investing Rules
Pearls of wisdom aplenty here as 150 investors from all corners of the stock market lay down their ten investing rules. Just about every technique, sector and asset class are covered, with contributions coming from, among others, Jim Slater, John Bogle, Ken Fisher and Evil Knievel. Produced in an extremely readable format, it's probably the only investment book that can claim to have 'something for everyone'
- Contrarian Investment Strategies
Author David Dreman will certainly appeal to sufferers of stock market demophobia. The book presents convincing evidence of why avoiding the herd, buying out-of-favour companies and using simple value measures all combine to produce the best route for investment success. There's a fair chunk of data to plough through, but Dreman's 41 tenets serve today's value investor very well.
- The Stock Market
Few will have heard of John Littlewood's book -- let alone have read it -- but it's a genuine masterpiece. Littlewood's recount of the post-War period up to the mid-1990s gives a thorough review to seemingly every event that affected UK shares. A treasure trove of fascinating anecdotes and statistics, Fifty Years is the authoritative guide to the reasons behind the London market's ups and downs over decades past.