The Four Pillars of Investing
William J. Bernstein
If you were to read just one book on this list, purchase this one. The book teaches you about proper asset allocation.
A Random Walk Down Wall Street
Burton Malkiel
A classic book that basically states most people do not beat index based funds. Presents all of the evidence and research on this subject.
The Investor’s Manifesto
William Bernstein
Bernstein’s latest book that discusses the sub prime crisis and goes into additional details about asset allocation. Also read my detailed review of the book.
The Intelligent Asset Allocator
William Bernstein
Bernstein’s first book, and goes into much more detail than “The Four Pillars of Investing” book. If you want to understand more of the technical details pick up this book
The Intelligent Investor
Benjamin Graham and Jason Zweig
The classic value investing book that everyone should read. It has been updated with comments from Jason Zweig who currently works at the WSJ.
The New Buffettology
Mary Buffett and David Clark
Insights in the mind of Warren Buffet, and the investments he makes.
Wealth Secrets of the Affluent
Christopher Jarvis and David Mandell
All sorts of tips and details into protecting your wealth from legal troubles.
The Millionaire Next Door
Thomas Stanley and William Danko
How do wealthy people act? Much different than you expect and they are among us.
The E-Myth Revisited
Michael Gerber
A book that is a MUST have for any entrepreneur. Gets you out of just being a technician.
Stop Acting Rich
Thomas Stanley
The latest book from the same author who wrote, “The Millionaire Next Door”. Read my detailed review of the book
Buffettology
Mary Buffett and David Clark
First installment with insight on how Warren Buffett invests.
Rich Dad Poor Dad
Robert Kiyosaki
Great for someone wanting to start a business, and has some out of the box ideas. Yes it contains a lot of fluff, but it does have some great advice. See our recent Rich Dad, Poor Dad review
Precious Metals Investing For Dummies
Paul Mladjenovic
A straightforward book that discusses investing in commodities.
The Creature from Jekyll Island
G. Edward Griffin
Puts the Federal Reserve in a different light. Somewhat long and long winded but it’s still an eye opening read.
Unlimited Wealth
Paul Zane Pilzer
An old economic book that’s currently out of print, but a great discussion on how wealth is created.
Thanks for the great list of resources. I might add the “Big Short” to this list, as well as Napoleon Hill’s classic “Think and grow rich“.
Forgot about think and grow rich. Good one!
Interesting mix between go for index and active investing….Like trying to see both sides
I’m a fan of indexing for most of one’s portfolio. Value investing IMHO is the only one that can beat indexing consistently.
These are some great books — been looking at buying a couple of them for some time now. Just havent found the time to read them just yet. d’oh
I have read a lot of these books, but I still need to read The Intelligent Investor.
I also highly recommend The Richest Man in Babylon or The Wealthy Barber, for people who are new to personal finance.
Yea the Wealthy Barber is a good one. I never thought about including that one since it’s pretty basic, but if you know nothing about PF it’s a great start.
A lot of good books there! I would add “The Wealthy Barber” and “I Will Teach You to be Rich” for PF, and “Economics in one Lesson” as a primer to learning more about opportunity costs and many common economic fallacies.
That’s a good list. What did you think about Edward Griffin’s book on the Fed?
I think some of the book is a little big in conspiracy theories. I don’t know if I buy what all is said. I take some of it with a grain of salt, but it does help put things in a different light.
For investing, I’d have to add Capital Ideas by Peter Bernstein, Fooled By Randomness by Nasim Nicholas Taleb and Common Sense on Mutual Funds by John Bogle.
I’d say people need to get over the conceit they — or hardly anyone long term — can beat the market. You mention value investing. Ah, but how do you decide when a stock is really undervalued?
My personal choice is to invest for income. I think that’s basically what Buffett does. He looks for companies that return a lot of cash. Too bad he refuses to pay dividends to Berkshire Hathaway shareholders.
I agree that Rich Dad, Poor Dad is worth reading even though it’s probably 90% — or even 100% — fake. Reporters in Hawaii have looked for “rich dad” without success. And “poor dad” eventually became the state’s superintendant of education, hardly a welfare position. Still, it’s helpful to formulate your attitude that money is not fixed, that you can go out and do something to make more of it.
Corio
Hi Richard,
“You mention value investing. Ah, but how do you decide when a stock is really undervalued?”
Yes I’ve mentioned this a few times on my blog. But isn’t that true with anything you purchase? Yes something may be 40% from a sale, but if you never use the product or it doesn’t work properly, what good is it? The key to value investing is know your companies inside and out. Know what they make, know their financials, know their history, know the industry. Then and only then can you determine if a company is valued right.
I agree, it’s not perfect, and is more of an art than science. IMHO though value investing is the only long term strategy that is worth trying against indexing, and proper asset allocation.
I’m a big proponent for indexing and most people should have most of their assets into it. Though I don’t believe the market is completely efficient all of the time for all stocks. The description of “Mr. Market” describes this perfectly. Like Taleb, states putting most of your money into bonds (90%) and 10% into speculative options is the best bet. In my case it’s more like 90% into proper asset allocation and 10% speculative.
With regards to Rich Dad, Poor Dad – I know this info but yet still put it up as it is a mind changer book. Just don’t get suckered into buying his other books and products. They are just a rehash of the first book. Maybe buy his second book “Cashflow Quadrant“, but that’s it. I’ve read his books after a few years of owning a business, so I’m not speaking from naivety.
‘The Four Pillars of Investing’ is the best book and if I had read it before (and of course followed it) I would have not lost so much money.