There are numerous lists of the best investing books available online nowadays. However, this one is distinct.
We have shared 💼 Superinvestor's Portfolios through our social media posts, featuring renowned investors such as Bill Ackman, Warren Buffett, Ray Dalio, Carl C. Icahn, and others. These portfolios offer valuable insights and potential ideas that investors can contemplate. So, we did a little research on what books the most successful investors recommend.
We have compiled a comprehensive list of over 200 recommended books on investing. We then listed them based on the number of recommendations each book received. This resulted in a list of 12 great books for investors.
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📚 The Intelligent Investor
In "The Intelligent Investor" Graham delves into key financial concepts related to stock investments, bond relations with inflation, and interest rates. Graham underscores two pivotal principles: the "Margin of Safety" and the importance of understanding "Uncertainty". When investing in common stocks, he advocates for diversification across 10 to 30 large-cap stocks with promising prospects and risk-based capital. Additionally, Graham emphasizes the significance of consistent performance and recommends limiting the purchase price based on the company's average net income per share over the past seven years.
Graham mentioned in his book that "If a person sets out to make profits from security purchases and sales, he is embarking on a business venture of his own, which must be run in accordance with accepted business principles if it is to have a chance of success."
// Recommended by Bill Ackman, Bruce Berkowitz, Warren Buffett, Michael Burry, Joel Greenblatt, Seth Klarman, Mohnish Pabrai, Walter Schlossl, Guy Spier
📚 Security Analysis
The sixth edition of "Security Analysis," building on the foundational 1940 version, is enriched with commentary from renowned Wall Street experts, reinforcing the timeless relevance of Graham and Dodd's investment principles. With contributions from the likes of Seth Klarman and Bruce Greenwald and an insightful foreword by Warren E. Buffett, the book underscores the enduring wisdom of value investing in modern markets.
Graham's expertise was not limited to quantitative analysis; he was a multifaceted genius, co-writing a Broadway play and even translating a Spanish novel. His deep concern for everyday investors is evident throughout the book, demonstrating his commitment to genuine value over fleeting market trends.
// Recommended by Bill Ackman, Bruce Berkowitz, Warren Buffett, Michael Burry, Joel Greenblatt, John Griffin, Seth Klarman, Walter Schloss and Don Yacktman
📚 You Can Be A Stock Market Genius
Joel Greenblatt, a successful fund manager who has consistently outperformed the Dow, offers a hands-on guide to mastering the stock market in his book. Drawing from his experience, Greenblatt highlights overlooked investment opportunities where individual investors can capitalize on and outpace Wall Street professionals.
The book sheds light on special situations like spin-offs, restructurings, and bankruptcies that can yield significant profits. While the strategies presented necessitate thorough research, this may be why many mainstream investors haven't fully embraced them.
// Recommended by Bill Ackman, Michael Burry, David Einhorn, Seth Klarman, Dan Loeb, Guy Spier
📚 The Essays Of Warren Buffett
The definitive book on Warren Buffett's views, curated by Lawrence Cunningham, is a compilation of Buffett's insightful letters to Berkshire Hathaway shareholders spanning from the 1980s to the first internet bubble. The book presents Buffett's perspectives on a plethora of topics, including governance, investing, common stock, and acquisitions, emphasizing principles like the importance of aligning interests with shareholders and buying great businesses at fair prices. It also delves into alternative forms of investing, touching upon junk bonds and preferred shares.
Despite certain sections feeling dated due to the evolving financial landscape, the book's core teachings, particularly on valuation and accounting, remain invaluable for understanding the intricacies of modern businesses and market behaviors.
// Recommended by Bill Ackman, Bruce Berkowitz, Joel Greenblatt, John Griffin, Don Yacktman
📚 The Warren Buffett Way
"The Warren Buffett Way" offers a detailed look into the strategies that have driven Warren Buffett's investment success. This edition not only updates readers on Buffett's latest investments but also incorporates insights from behavioral finance to highlight the importance of rational decision-making in investing.
Key takeaways include the significance of thinking as a long-term investor, understanding the impact of "loss aversion" on investment decisions, and the role of rational behavior in navigating market volatility. The book asserts that the real challenge in emulating Buffett isn't merely stock selection but maintaining resilience and commitment in uncertain market conditions.
// Recommended by Bill Ackman, Joel Greenblatt, John Griffin, Howard Marks, Mohnish Pabrai
📚 Reminiscences Of A Stock Operator
This book is a fictionalized biography of renowned investor Jesse Livermore, who gained and lost vast fortunes in his lifetime, most notably by shorting the market right before the 1929 crash. The narrative, which presents Livermore as Larry Livingston, chronicles his journey from his early days in bucket shops to his tumultuous experiences on Wall Street.
Lefèvre captures the essence of investing strategies, market psychology, and the pitfalls of following external tips. Among the key insights are Livermore's "probe" approach, where he incrementally built his stock positions based on market responses, and his emphasis on trusting one's judgment, understanding historical market patterns, and optimizing gains by riding out investments.
// Recommended by Bruce Berkowitz, John Griffin, Dan Loeb, Guy Spier
📚 Margin Of Safety
Seth Klarman's book emphasizes the essential value investing principle of ensuring a difference between a stock's intrinsic value and its market price. Drawing inspiration from Benjamin Graham's advice to always invest with a "margin of safety," Klarman, a renowned hedge fund manager at the Baupost Group, delves into this philosophy, highlighting its significance for long-term investment success. He contrasts value investing, which aims at buying securities at a significant discount from their true value, with the speculative and often risky approaches that promise quick riches but lack a solid foundation. Klarman's work serves as a guide, stressing that adhering to value investing principles provides a robust pathway to achieving consistent investment returns.
The “margin of safety” is the difference between the intrinsic value of a stock and its market price. Seth Klarman has used the concept to become one of the most successful hedge fund managers of the day at the Baupost Group.
// Recommended by Bill Ackman, David Einhorn, Joel Greenblatt, Guy Spier
📚 Common Stock, Uncommon Profits and Other Writings
First published in 1958, Common Stock, Uncommon Profits and Other Writings by Philip Fisher was one of the books that helped shape a young Warren Buffett’s investment philosophy. Fisher emphasizes the importance of thorough business understanding and advocates for in-depth analysis of individual companies over broad economic forecasting.
The book provides insights into identifying companies with exceptional growth potential and shares unique perspectives like the opportunity to invest when war fears depress market values. The updated edition incorporates contributions from Fisher's son, Ken, adding to its timeless wisdom.
// Recommended by Michael Burry, Warren Buffet, John Griffin
📚 One Up On Wall Street
In "One Up On Wall Street," Peter Lynch shares his investment philosophy and methods to help individuals succeed in investing. This guide demonstrates how everyday knowledge can help average investors outperform professionals.
The book promotes the simple principle of investing in familiar companies. Lynch asserts that by observing our surroundings and recognizing promising products or services early, investors can identify "tenbaggers" or stocks that multiply in value tenfold. Providing actionable advice on evaluating companies, Lynch's book underscores the importance of long-term investing and has solidified its place as a top-tier investment classic.
// Recommended by Bill Ackman, John Griffin, Mohnish Pabrai
📚 Influence: The Psychology Of Persuasion
In the highly praised New York Times bestseller, Dr. Robert B. Cialdini elucidates the psychology behind why people agree and how to use these principles ethically in both professional and personal contexts. These principles -reciprocation, commitment and consistency, social proof, liking, authority, and scarcity - are presented as tools for ethical persuasion in business and daily interactions.
Supported by decades of scientific research, Cialdini offers a comprehensive guide on how our minds can be easily influenced - and how to prevent it. The book, esteemed by thought leaders like Charlie Munger, illuminates the often-unconscious drivers of decision-making.
// Recommended by Bruce Berkowitz, John Griffin, Charlie Munger
📚 The Great Crash 1929
Galbraith critically examines the stock market collapse of 1929, attributing its cause to rampant speculation and a widespread belief in getting rich without effort. Drawing parallels between 1929 and the 2008 financial crisis, the book identifies recurring patterns such as high financial leverage, fraudulent schemes, and misplaced faith in the free-market system. Galbraith underscores that while market crashes lead to temporary immunity from speculative outbreaks, society's short memory makes recurrence inevitable.
Galbraith's insightful warnings remind us of the dangers of overlooking financial history. They serve as a crucial reminder that markets are not always efficient and that attempting to accumulate wealth through individual stock selection can be challenging.
// Recommended by Bruce Berkowitz, Warren Buffett, Jim Chanos
📚 The Little Book Of Common Sense Investing
This book delves into the teachings of John Bogle, the creator of Vanguard and the inventor of index funds. It explains why the index-based approach to investment is the smarter choice for non-professional investors and how it can even outperform the strategies of many professional investors. Bogle emphasizes the significance of buying and holding a mutual fund that mirrors a broad stock market index, like the S&P 500, highlighting that it assures investors a fair share of stock market returns.
Supported by financial luminaries like Warren Buffett and Benjamin Graham, the book underscores the importance of focusing on tangible business realities over market speculations and the power of compounding returns. The updated edition provides insights into asset allocation and retirement investing, making it a must-read for anyone aiming for a stable financial future.
// Recommended by Warren Buffett, Charlie Munger, Mohnish Pabrai
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