This review looks at the best investment analysis books for anyone wishing to dive deeper into the subject, and then some.
Table of Contents
Fundamental Analysis for Dummies
by Matthew Krantz
Review – The general consensus on this book is that it provides a concise and easy to understand overview for the material a beginning investor needs to grasp to make a start. It covers the main financial ratios and gives some ideas on how to use them. However, the subject is not explored in any depth. Question – do you need to be able to actually do fundamental analysis in order to use it? I suppose I would say – not entirely. The fact is this book is not going to teach you how to take a company’s financial statements and work out their price to book value or their current ratio. If you are comfortable without that knowledge – fine. Perhaps it is fair to say that the book is for dummies but any dummy who reads it won’t be transformed into a competent expert.
My verdict: Suitable as an introduction for beginners.
Ratio Analysis Fundamentals
by Axel Tracy
Review – This is a short book but it does do exactly what the title suggests. The stated purpose of the book is to help the analyst compare similar ratios from one company to a competitor to work out which may have a competitive advantage. It also explains how to compare the same ratio for a company over different time periods to work out where that company is heading. The book tries to teach what the financial ratios actually mean. On the downside, it is maybe a little skimpy.
My verdict: Suitable as a basic source of information for beginners.
by Benjamin Graham and David L. Dodd
Review – This probably qualifies as the bible of fundamental analysis reference tomes. If you are going to put the hard copy on a shelf look for the 2nd edition to avoid the disappointment that some chapters that were left out of later editions. The powerful personality and values of the author, Benjamin Graham, who was affectionately known as the Dean of Wall Street is clearly expressed through his writing.
My verdict: Suitable for serious and professional traders.
Technical Analysis for Dummies
by Barbara Rockefeller
Review – The author clearly knows and understands her subject. This book will walk you through all the main areas of technical analysis and impart a solid understanding. On the downside, it is not well written and in some places overly wordy. The subject itself is better imparted through visual examples and explanations and the book could have used more of that than lengthy explanations. So again a book for dummies that may satisfy a total newbie.
My verdict: Suitable for beginners.
Charting and Technical Analysis
by Fred McAllen
Review – This book provides a very thorough explanation of all the detailed aspects of charting price data. It uses only candlestick patterns but as those are the most popular that is not a disadvantage. Where the book disappoints and can frustrate is the quality of the images is not great. Inside the covers of the print version, it is all black and white which makes it hard to see the detail in the candlesticks.
My verdict: Suitable for beginners and intermediate traders.
Technical Analysis of the Financial Markets
by John J. Murphy
Review – This book comes highly recommended both by experienced private retail investors and traders and by professionals. It is well written, accessible, and thorough in its treatment of the subject. If you know you want to get an in-depth grasp of the subject, it may make sense to skip the other introductory tomes and go straight for this one.
My verdict: Suitable for beginners, intermediate and professional traders, and reference.
by Gregory Zuckerman
Review – Of all the books on quantitative analysis and the mathematical approach to investing, this book is an easy way to start reading into the topic. It is more a human story than a rigorous mathematical work, so if you really want to get to grips with this subject you will need to get your hands on a work that deals with code, like the next one on this list. But if you want a good and engaging read on the subject, this book is for you.
My verdict: Suitable for investors and traders interested in a primer in quantitative analysis.
Python for Finance
by Dr. Yves Hilpisch
Review – Dr. Hilpisch is a well-established authority on this subject and this book gives a thorough treatment, providing many pieces of open source code that can be combined into working programs. This is an extensive work, by a practitioner written for practitioners.
My verdict: Suitable for programmers wanting to build financial models.
Reminiscences of a Stock Operator
by Edwin Lefevre
Review – This book as the distinction of being the one successful investors and fund managers recommend the most. It will soon be over a hundred years old but is still an excellent read. It gives valuable insights into the psychology of markets and the emotional side of trading that the professional and wannabe successful trader needs to master. For a detailed dive into this great book, check here.
Money Masters of Our Time
by John Train
Review – This is a book that seeks to explain the investment approach of famous and successful investors and fund managers. This has proved such a successful approach for a book that the author, John Train, has published two updates this latest in 2000. He felt the need to explain new approaches that became more prevalent with financial deregulation and technological advances of the 1980s and ’90s. It is an enjoyable read full of gems of wisdom and while it can be a good source of tips there isn’t the material you would need to develop your own systematic approach to investing. For a single page downloadable PDF summary of the main points, check here.
My verdict: Suitable for beginners and a good read.
A Random Walk down Wall Street
by Burton G. Malkiel
Review – This readable book covers many aspects of personal finance, saving and investing, and comes to the conclusion that we should all stick with indexed funds. It is a book that has its ardent adherents and its equally passionate detractors. I’d say if you are going to get into trading and active investing with the intent to do better than the broad market then it is a good idea to read this book as it will give you an understanding of the foundations of an opposite view. After all, it is educational to introduce different voices into our echo chambers from time to time.
My verdict: Suitable for beginners, reinforcing material for conservative investors.
The Intelligent Investor
by Benjamin Graham
Review – The sub-title to this book is – The Definitive Book on Value Investing – which clearly demonstrates the link between fundamental analysis and value investing. Many have called this the most accessible must-read for all investors and traders. The author, Benjamin Graham was a towering figure in the world of investors. He was also Warren Buffet’s mentor. In addition to providing a solid foundation in fundamental analysis, the book is intended to explain and teach Graham’s investment approach to the layman. And it succeeds. For a comprehensive review of The Intelligent Investor, check here.
My verdict: Suitable for beginners and recommended reading for all traders and investors.
How to Make Money in Stocks
by William J. O’Neil
Review – This is probably one of the easiest-read books on what might be called growth investing. The approach the book advocates is probably closer to trading than investing. This is not a work that will please value investors or those who adhere to Benjamin Graham’s serious, steady, and straight-laced approach to building wealth. There is also more than a fair dose of advertisements for the author’s subscription investing and trading services. Notwithstanding these caveats, the book really does deliver a complete trading and investing system as it promises. For an in-depth review of How to Make Money in Stocks, click here.
My verdict: Suitable and recommended for beginners who want to trade and invest using a growth strategy.
I hope you found these book reviews useful. Let me know if you think I got anything wrong, or if in your opinion some other book should have been included in the list. If you did get this far I guess you found some value, so please do me a favor and share this on your social network. Scroll down and you will find easy click on buttons to your Facebook, Twitter, or Pinterest pages. Thanks!
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