Generally, the most successful people in the world are also voracious readers. This is also true of the most successful value investors.
Both Warren Buffett (who used to read 1,000 pages a day when he was starting out) and Charlie Munger (who often advises young investors to “develop into a lifelong self-learners through voracious reading”) credit their habit of reading as a major contributor to their success.
Ben Graham was an even more prolific reader than his successors – he would often quote the Latin and Greek classics and once translated a Spanish novel into English.
Hopefully, I’ve convinced you how important it is to read and learn, especially if you are new to investing. Luckily, I’ve compiled a list just for you (don’t worry, you won’t have to translate anything from Spanish).
Best Books to Read as a Beginner Investor
Without further ado, here are the 10 best investment books for beginners:
We considered several factors when selecting books for this list, such as the author’s expertise, awards, critical acclaim, and online reviews. We also included new and noteworthy titles to provide readers with a diverse range of options and keep up-to-date with the latest trends.
The Definitive Book on Value Investing
By Benjamin Graham
If you only ever read one investment book, then let it be The Intelligent Investor by Benjamin Graham.
There’s a reason why Graham is called the “Godfather of Value Investing.” Benjamin Graham was probably the most influential investing figure of the 20th century, and The Intelligent Investor is probably the most influential investment book of all time.
The Intelligent Investor is the value investor’s bible… Keep this one on your bedside table.
How To Use What You Already Know To Make Money In the Market
By Peter Lynch
Peter Lynch is one of the most successful investors ever – from 1997 to 1990, his Magellan Fund averaged a 29.2% compound annual return.
In One Up on Wall Street, Peter Lynch explains how average investors can beat the pros by using what they know. According to Lynch, investment opportunities are everywhere: from the supermarket to the workplace, we encounter products and services all day long.
By paying attention to the best ones, we can find companies in which to invest before the professional analysts discover them.
What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not!
BY Robert T. Kiyosaki
A bestseller for over 25 years, Rich Dad Poor Dad is one of the most recommended books on investing and managing wealth in general. The book explains basic wealth generation in an understandable and inspirational way, and it’s a solid enough introduction to these concepts.
Kiyosaki points out the misleading educational system of America that is designed in such a way that people just cannot escape the Corporate race. Kiyosaki suggests that in order to escape investors must only invest in those assets that generate a yearly or monthly cash flow while providing upside in terms of equity value.
The Definitive Guide to Financial Market Returns & Long-Term Investment Strategies
BY Jeremy Siegel
Jeremy Siegel‘s nickname is the “Wizard of Wharton” (he’s been teaching there for 45 years). His investment book Stocks for the Long Run is sometimes called “the buy and hold Bible.”
The book makes the convincing argument that – after you account for inflation – equities are actually the safest investment in the long run, proving the point that most people should be long-term, passive investors in the stock market.
The Only Way to Guarantee Your Fair Share of Stock Market Returns
By John C. Bogle
Investing is all about common sense. Owning a diversified portfolio of stocks and holding it for the long term is a winner’s game. Trying to beat the stock market is theoretically a zero-sum game (for every winner, there must be a loser), but after the substantial costs of investing are deducted, it becomes a loser’s game.
John C. (“Jack”) Bogle is the founder of the Vanguard Group and creator of the world’s first index fund.
The Little Book of Common Sense Investing is a top recommendation of Warren Buffett’s. There’s actually a funny story that when Jack Bogle first met Warren Buffett, Jack recognized Warren, went up and introduced himself, and he said to Warren, “you know the thing I really like about you is you have rumpled suits just the same as I do” – and Jack and Warren have been good friends ever since.
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The Time-Tested Strategy for Successful Investing
By Burton G. Malkiel
Burton G. Malkiel’s classic and gimmick-free investment guide is now more necessary than ever. Rather than tricks, what you’ll find here is a time-tested and thoroughly research-based strategy for your portfolio.
Whether you’re considering your first 401(k) contribution or contemplating retirement, this fully updated edition of A Random Walk Down Wall Street should be the first book on your reading list.
Techniques for Analyzing Industries and Competitors
By Michael Porter
Studying Michael Porter is one of the first things you do in business school. Competitive Strategy by Michael Porter has transformed the theory, practice, and teaching of business strategy throughout the world.
This book introduces Porter’s 5 Forces to help investors analyze industry attractiveness, as well as the 3 forms of a company’s strategy – low cost, differentiation, and focus.
A Financial History of the World
By Niall Ferguson
Niall Ferguson follows the money to tell the human story behind the evolution of our financial system, from its genesis in ancient Mesopotamia to the latest upheavals on what he calls Planet Finance. What’s more, Ferguson reveals financial history as the essential backstory behind all history, arguing that the evolution of credit and debt was as important as any technological innovation in the rise of civilization.
This is a great overview of all things money and a nice introduction to the world of finance.
By Daniel Kahneman
Daniel Kahneman is a professor of behavioral & cognitive psychology at Princeton, winner of the 2002 Nobel Prize for economics, and author of the best-selling book on cognitive biases and heuristics: Thinking Fast & Slow.
This book explains the natural biases that affect our judgment in everyday life, as well as in investing. If you want to be a great investor, then it’s critical to be aware of the biases and tendencies.
This is a fascinating book, and Kahneman himself is actually the subject of Michael Lewis’s book The Undoing Project.
Timeless Lessons on Wealth, Greed, and Happiness
by Morgan Housel
Morgan Housel is a former columnist at The Motley Fool and The Wall Street Journal. There is no practical investing advice in the book. Instead, The Psychology of Money focuses on all the ways people think about wealth, economics, and success.
The book is comprised of 19 stories that illustrate how people make decisions about money in their life. Instead of pretending that humans are perfect decision-making machines, Housel shows you how your psychology can work for and against you.
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