A\u00a0Reading List\u00a0for Individual Investors<\/strong><\/em><\/p>\n

I enjoy reading about investing, and, over the years, I have built up quite a large library of investing books. I thought I\u2019d share a few of my favorites.<\/p>\n

Readers may notice that the books I\u2019ve listed cover several different investment philosophies. I\u2019m an advocate\u00a0of indexing, but I have included\u00a0one \u201cstock picking\u201d classic (The Intelligent Investor<\/em>). I’ve also\u00a0included several books on behavioral finance.\u00a0I think it is important for investors to be exposed to a variety of viewpoints, and I believe that\u00a0each of these\u00a0books\u00a0contains\u00a0some\u00a0valuable wisdom.<\/p>\n

I have labeled this list as \u201cPart 1\u201d because I plan to follow-up in a week or two with another list which focuses more on the analytics of investing. The \u201cPart 2\u201d list will include textbook and \u201chow-to\u201d book suggestions.<\/p>\n

\n
1. Common Sense on Mutual Funds – John C. Bogle:<\/a>\u00a0 <\/strong><\/em>This is a must read for every investor.\u00a0 The book makes an excellent case for indexing.\u00a0 Regardless of your investing philosophy, you should read this book and think hard about Bogle’s arguments.<\/li>\n
2. Unconventional Success – David F. Swensen:<\/a> <\/em><\/strong>Swensen is the manager of Yale University’s endowment.\u00a0 This book is geared towards individual investors (he has another book aimed at institutional money managers), and it is entertaining and informative to read Swensen’s attacks on much of the money management industry.\u00a0 Before I read this book, I was unaware of many of the sneaky methods which are used to hide fees within actively managed funds.<\/li>\n
3. A Random Walk Down Wall Street – Burton G.\u00a0Malkiel:<\/a> <\/em><\/strong>I haven’t read the latest edition of this book, but this is an investing classic.\u00a0 <\/em><\/strong>The book advocates indexing and intelligent asset allocation.<\/li>\n
4. <\/a>Stocks for the Long Run – Jeremy J. Siegel:<\/a><\/strong>\u00a0<\/em>Siegel is typically\u00a0very optimistic about the future of equities, and, in this book, he makes his case using a tremendous amount of historical data.\u00a0 This is another book where I haven’t read the latest edition.\u00a0 I have\u00a0read that he recommends\u00a0overweighting dividend stocks\u00a0in this edition.\u00a0I’m not sure I would agree, but I’d love to\u00a0read the\u00a0argument and see the data.\u00a0<\/li>\n
5. <\/a><\/em>Irrational Exuberance – Robert J. Shiller:<\/a><\/em><\/strong>\u00a0<\/em>Shiller makes a strong case for\u00a0keeping an eye on market\u00a0valuation, and he attempts to explain some of the factors which drive financial bubbles.\u00a0 I’m not convinced by everything he has to say, but I do think there is a lot in this book that is worth considering.<\/li>\n
6. <\/a>Your Money and Your Brain – Jason Zweig:<\/a><\/strong>\u00a0<\/em>This book provides a very accessible look at the psychology of investing.\u00a0 <\/strong>The idea behind this book is that developing a better understanding the emotions and biases that humans bring to financial decisions will help you develop strategies to minimize their impact.<\/li>\n
7. The Intelligent Investor-\u00a0Benjamin Graham:<\/a> <\/em><\/strong>Benjamin Graham was the father of value investing, and he was a mentor to\u00a0the young Warren Buffett. I\u2019m not a stock picker, but I do appreciate the book’s\u00a0emphasis on value and margin of safety. The wild swings of the stock market often cause investors to let emotion overpower reason, and learning to think more like Benjamin Graham will help investors to ignore the noise and stay the course.<\/li>\n
8. <\/a>The Winner’s Curse – Richard Thaler (Advanced): <\/a>\u00a0<\/strong><\/em>Most standard economic theories assume that individuals make rational choices, but behavioral economics argues that this is often not the case. This book summarizes much of the recent research in behavioral economics. This book is advanced reading, and it includes a lot of economic theory.<\/li>\n
9. <\/em>Inefficient Markets – Shleifer (Advanced):\u00a0 <\/a><\/em><\/strong>Modern behavioral finance is often said to rest on two pillars. The first pillar is \u201cinvestor psychology\u201d and this is covered very well by The Winner\u2019s Curse <\/em>and Your Money and Your Brain<\/em>. The second pillar is \u201climits to arbitrage\u201d and this book delves deeply into that idea. This is advanced reading. There are a lot of equations and knowledge of financial theory is assumed. However, I found the book to be fascinating. If you have some background in financial theory, then this book is highly recommended.<\/li>\n<\/ol>\n

   Disclosure: The links in this post are affiliate links. That means that if you click through from my link and buy the book, I receive a small commission.\u00a0 <\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

   A\u00a0Reading List\u00a0for Individual Investors I enjoy reading about investing, and, over the years, I have built up quite a large library of investing books. I thought I\u2019d share a few of my favorites. Readers may notice that the books I\u2019ve listed cover several different investment philosophies. I\u2019m an advocate\u00a0of indexing, but I have included\u00a0one \u201cstock […]<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.calculatinginvestor.com\/wp-json\/wp\/v2\/posts\/1729"}],"collection":[{"href":"https:\/\/www.calculatinginvestor.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.calculatinginvestor.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.calculatinginvestor.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.calculatinginvestor.com\/wp-json\/wp\/v2\/comments?post=1729"}],"version-history":[{"count":77,"href":"https:\/\/www.calculatinginvestor.com\/wp-json\/wp\/v2\/posts\/1729\/revisions"}],"predecessor-version":[{"id":1804,"href":"https:\/\/www.calculatinginvestor.com\/wp-json\/wp\/v2\/posts\/1729\/revisions\/1804"}],"wp:attachment":[{"href":"https:\/\/www.calculatinginvestor.com\/wp-json\/wp\/v2\/media?parent=1729"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.calculatinginvestor.com\/wp-json\/wp\/v2\/categories?post=1729"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.calculatinginvestor.com\/wp-json\/wp\/v2\/tags?post=1729"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}