If you’ve got a few minutes to spare over the Christmas break while the markets are shut, it’s a perfect time to kick back and do a little reading.
Investors tend to be self-taught, in my experience. And the best investors are always learning and are honest enough to admit what they don’t know (yet).
These investing books are my favourites, covering everything from the basics to the super complex.
Stone-cold classic: The Intelligent Investor by Benjamin Graham (1949)
Even 70 years after it was published, The Intelligent Investor has never been more relevant. Born into poverty in London, Graham later made his name in America by single-handedly inventing the modern method of share analysis. Investing giants like Warren Buffett constantly cite Graham as their inspiration.
Benjamin Graham was a revolutionary, with an incredible ability to go much deeper than the statisticians that preceded him to create new investing techniques. He also urged readers to be extremely sceptical of companies, and to look behind the figures.
Younger investors tend to seek out the most up-to-date books to try to get a handle on the complexities of the markets, but if they ignore this classic, they will be doing themselves a disservice. Not to mention missing out on the basics and the principles that started many of us along our investing journies.
A second Graham book, 1934’s Security Analysis, almost made this list and is definitely worth checking out. Written in the aftermath of the stock market crash that crippled Wall Street, the book explains important analysis tools like margins of safety, as well as bringing clarity to how investors should think about the different types of investments they make.
For improvers: The Naked Trader by Robbie Burns (2005)
A former ITV and Teletext journalist with a simple philosophy and a great turn of phrase, Robbie Burns made a ton of capital from a couple of canny money-spinners that allowed him to quit his job, escape the rat race, and go into trading full time.
Most traders will show you their wins but gloss over their mistakes and the times they lost money. Not so with Burns, who is refreshingly honest about his shortcomings and shows you exactly how he overcame them to be a better investor.
While this is the perfect introduction to trading for the newbie, there is a lot of information that will appeal to more sophisticated investors, including how to read charts, set stop losses, and do spread betting to hedge against long positions by shorting.
To build better wealth: Smarter Investing by Tim Hale (2006)
Subtitled, Simpler Decisions for Better Results, Hale’s work lays out the methods you need to make quick decisions to enrich yourself. Hale goes into vast detail about every aspect of the market in a clear and easily readable way, which is no small feat in itself.
Most investing tomes will try to sell you a theory for guaranteed, repeatable results with rules that are impossible to replicate in the real world. What Hale’s book does so well is to instead arm you with the knowledge you need to make your own intelligent decisions.
You can be safe in the knowledge that it’ll be a happier Christmas and a wealthier future with any one of these books in your stocking this year.
