If there are 3 books to read before you start investing, these books should be the ones to add to your reading list!
The wealth of knowledge contained in these books is staggering and the techniques learned can make a huge difference to the value of your personal portfolio. They will provide you with a solid understanding around three key schools of investing thought: value investing, speculative investing and asset allocation.
Let’s take a look:
The Intelligent Investor – by Benjamin Graham
Benjamin Graham is known to be the most famous investment advisor of the 20th century. His book on value investing has inspired hordes of people around the world and continues to do so every day. Published in 1949, this investing bible discussing Graham’s Value Investing philosophy, showing investors how to develop long term strategies and prevent errors.
Many know Benjamin Graham as the mentor of the legendary Warren Buffett, and Buffett wholeheartedly agrees that every serious investor should read this book:
“Chapters 8 and 20 have been the bedrock of my investing activities for more than 60 years,” Buffett says. “I suggest that all investors read those chapters and reread them every time the market has been especially strong or weak.”
The Alchemy of Finance – by George Soros
Anyone who needs convincing of the reasons to read this book needs only to look to the success of the author himself. George Soros, who was born in and survived the occupation of Hungary in the 1930s and 40s, has accumulated a large fortune through the investment fund he founded and managed, Soros Fund Management LLC.
This book discusses some of the fundamental truths a speculator investor, notably traders, should ask themselves. By reading this book, you will gain an understanding of Soros’ theory of ‘reflexivity’, a practise that bridges the gap between what we see in the market (reality) and economic theory, straight from the mind of one of the most powerful and profitable investors in the world.
Unconventional Success: A Fundamental Approach to Personal Investment – by David F. Swensen
In Unconventional Success, Swensen discussing how investors can manage their financial assets through the fundamental approach. Swensen is quick to point out that the for-profit mutual fund industry consistently fails the average investor. He recommends that an individual investor should play a more active role, and gives you practical, specific tips on exactly how to do that in this book.
David Swensen is in fact the money manager and Chief Investment Officer of Yale University. The school’s endowment has returned almost 16 percent per annum in most years since Swensen took over in 1985; a far better record that most of the executive on Wall Street!
By reading these books you will have the ability to consume years of research made by influential money managers whose success speaks for itself. With fascinating nuggets of advice on every single page, these three books offer an outstanding wealth of learning from some of the world’s brightest minds: take a moment to invest in yourself!