The best must read investment books of all time.
Warren Buffett was once asked about the key to success. He pointed to a stack of nearby books and said, “Read 500 pages like this every day. That’s how knowledge works. It builds up, like compound interest.”
Bill Gates reads about 50 books per year, averaging to one per week.
Charles Munger, Warren Buffett’s investment partner has so many famous quotes on the power of reading. Some of them:
“In my whole life, I have known no wise people (over a broad subject matter area) who didn’t read all the time – none, zero.”
“You’d be amazed at how much Warren reads – at how much I read. My children laugh at me. They think I’m a book with a couple of legs sticking out.”
Investment books are like oxygen to the body and soul of the serious investor. You need to read consistently and broadly.
Below I have summarized what I believe are 15 of the best classic investment books of all time which I have personally read. There are so many more fascinating books on investment.
These 15 books should form the backbone for any investor.
Both the novice and experienced investor will be empowered by the knowledge embedded in these classics.
The Intelligent Investor by Benjamin Graham was first published in 1949. It is the definitive text on value investing and was instrumental in honing the investment style adopted by Warren Buffett who was his student at Columbia University.
Buffett described it as “By far the best book on investing ever written.”
Buffett goes on to advise that if you apply the lessons in Chapters 8 & 20, “you will not get a poor result from your investments.”
Security Analysis, another investment classic, was written by Professors Benjamin Graham and David Dodd of Columbia Business School. This book laid the intellectual foundation for the investment style known as value investing adopted by his most famous student, Warren Buffett.
You Can Be A Stock Market Genius is a comprehensive and practical guide to the stock market from Joel Greenblatt, a very successful fund manager. This book is a gem and equips you with the information and strategies you need to win in the stock market.
The Essays of Warren Buffett: Lessons for Corporate America is a compilation of the thoughts, philosophy and writings of the greatest investor of all time Warren Buffet – an invaluable resource and I dare say, a must for any serious investor, fund manager or CEO.
Reminiscences of a Stock Operator , first published in 1923, is the fascinating and entertaining story of the life of Jesse Livermore, one of Wall Street’s greatest ever stock speculators – one of my all time favourites.
Some of the stories have become Wall Street lore especially on crowd psychology and market timing.
There are several pertinent gems and quotes from the book – two below:
“Prices are never too high to begin buying or too low to begin selling.”
“I did precisely the wrong thing. The cotton showed me a loss and I kept it. The wheat showed me a profit and I sold it out. Of all the speculative blunders there are few greater than trying to average a losing game. Always sell what shows you a loss and keep what shows you a profit.”
The Money Masters by John Train chronicles the winning strategies of nine of the most successful investors of our time — Benjamin Graham, Warren Buffett, John Templeton, and Philip Fisher, among others.
In Market Wizards, Jack Schwager interviews seventeen of the most successful traders of all time including Bruce Kovner, Richard Dennis, Paul Tudor Jones, Michael Steinhardt, Ed Seykota, Marty Schwartz, and Tom Baldwin.
Read about the electrical engineer from MIT whose computerized trading earned returns of 250,000% over sixteen years to the trader who, after wiping out several times, successfully turned a $30,000 investment into an $80 million fortune.
Warren Buffett is the greatest investor of all time. His investment style has made him a billionaire and made many others very wealthy.
The first two editions of The Warren Buffett Way gave an insight into the investment strategies behind his spectacular successes. The new edition updates readers on the latest investments by Buffett and explains how investors can overcome the common obstacles that prevent them from investing like Buffett.
Philip Fisher is among the most admired and influential investors of all time. His investment philosophies, introduced almost forty years ago, remain very credible and applied by numerous investors today including Warren Buffett. First published in 1958, it has been updated by his son Ken Fisher, also a renowned investor in his own right.
Peter Lynch is one of my most admired investors of all time. He is remembered as the legendary manager of the Fidelity Magellan Fund between 1977 and 1990 when the portfolio rose 28-fold per share for the best performing fund in the world.
One Up On Wall Street is an insight into his investment philosophy and shows how the average investor can use what their everyday experiences and knowledge to invest and make money in the stock market.
One of my favourites!!
In Beating The Street, Peter Lynch shows how he puts his investing philosophy and techniques into action as he shows the step-by-step process he used to select the stocks he recommended at the 1992 Barron’s Roundtable.
He also analyzed the reasons he outperformed all other fund managers during his tenure at the Magellan Fund.
John Bogle is the legendary king and pioneer of index value investing.
The Little Book of Common Sense Investing is the classic guide to this simple and most effective investment strategy.
John Bogle shows how even the novice investor can build wealth over the long term by buying and holding a low cost mutual fund that tracks a broad stock market index such as the S&P 500.
I am a firm believer of the buy and hold investment strategy.
Another best selling investment classic, written by Burton Malkiel, an Economics Professor at Princeton.
Malkiel argues the random walk theory – that asset prices behave in a random and unpredictable fashion based on all available information and that one cannot consistently outperform market averages – this is referred to as the efficient-market hypothesis.
The latest edition has sections on exchange traded funds and emerging markets.
Another favourite classic of mine.
Stocks for the Long Run, by Wharton School Professor, Jeremy Siegel, is perhaps the most complete and irrefutable case ever written for investing long term in the stock market.
The recent edition also looks at the effects of the recent financial crisis on the global economy and long term market returns.
So these are 15 timeless investment book classics and perhaps the best of all time.
There are so many more as I mentioned earlier but the above will continue to be read by future generations of serious investors.