Investing BooksWould you be able to recommend any good investing books for beginner/intermediate level.
I have checked out Value Investing Congress website and it has a few books listed there but I am not sure if any will be beneficial for my level.
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There are an overwhelming number of books out there, it’s true. My favorite for beginning investors, to explain how to think of stocks as companies and to think about their basic business profitability and understand the valuation, are Peter Lynch’s One Up on Wall Street and Joel Greenblatt’s Little Book that Beats the Market (It’s in a new addition, the Little Book that Still Beats the Market). Those are both enjoyable to read and accessible for anyone — the “bible” of value-focused investors is (arguably) Benjamin Graham’s The Intelligent Investor, but most folks find that quite dry so it’s usually better to start with something else.
Another book I’ve just started reading that I like very much so far, and it’s a great counter to the claims of many managers, pundits and newsletter guys, is Market Sense and Nonsense: How the Markets Really Work [and how they don’t] by Jack Schwager.
Travis, did you read anything by David Swensen, such as “Pioneering Portfolio Management: An Unconventional Approach to Institutional Investment”?
Nope, I haven’t read that — I have read a few of his articles over the years and generally like his ideas for diversifying and investing in alternatives beyond the core US stock/foreign stock/bonds pie chart that still dominates most portfolios.
Swensen was (maybe still is) in charge of investing the Yale Endowment, and Yale and Harvard have been pioneers for many years in the use of alternative investments — they got a lot of attention for it in the mid-2000s when a lot of folks were just waking up to foreign small caps, timber, managed futures and other kinds of assets, haven’t heard much from them lately. There’s also a pretty good-sounding recent book (2009, I think — I haven’t read it yet) called The Ivy Portfolio (Faber and Richardson) that looks at how individuals can incorporate some of those asset strategies with ETFs and individual portfolios.
I’m interested to know Trav, (hope Trav is ok) if you’ve read or or are familiar Vitaliy Katsenelson’s Little Book OF Sideways Markets and his theory on the Secular (Secular usually being from 10 to 20 years, as opposed to cyclical being Months to a few years) market still having another 10 or more years of PE contraction or compression left till the next Secular Bull? And if so does this curtail or influence your stock choices?
Pete
I haven’t read it, but he gave a good presentation on it at the last Value Investing Congress and he’s got some interesting big picture ideas. I am skeptical of most huge forecasts like this, but it’s a worthwhile way to think about the markets and the economy — the problem is that although human nature is more or less the same as it’s been for the last 100 years, the flow of information is different and the global distribution of wealth and the demographics are all different. I’d prefer to look for specific opportunities that I think are driven by changes in the world or in companies rather than try to predict what the market or US GDP might do over the next decade — not because the latter isn’t valuable to know, but because I think it’s pretty much unknowable.
He has a good presentation here on “sideways markets”, and his website is generally a good place to browse his ideas as well.
And yes, “Trav” is fine by me — much better than some of the names I get called by anonymous emailers pretty much every day 🙂
Hey Travis, I finally read Little Book that Beats the Market , what is your view on the Magic Formula. I checked today and AAPL is top of that list.
I don’t follow it assiduosly, but when it comes to formulaic investing it sure makes more sense than most fundamental screens. I do have a little bit of money invested in two of the funds that use the “Formula.” I particularly love that book for it’s common sense description of how to value a business and understand a business — I think more investors should would do well to remember that the stock they’re trading represents a small and discrete chunk of a company with cash flow, operations, earnings and future plans.
Oh, and Apple is my largest holding so I certainly agree on that — but the magic formula doesn’t work if you cherry pick, you have to buy big baskets of stocks that meet the criteria. It works en masse, and I’m convinced of that, but it’s too un-entertaining for me to stick with it with all of my money and it doesn’t necessarily work for any one company or few companies.
Travis, where can I find a list of possible mutual funds adhere to this strategy?
Looks like they recommend a couple on their site, YTD return for FNSAX was pretty good it looks like. 5K is minimum though. But like you said it makes sense only if you do it long term right.