The same way our body requires nutrition and exercise to stay agile and young, our mind requires stimulation to stay sharp. Books are like fodder for our minds. They are not only a wonderful source of knowledge but also provide guiding principles and tangible solutions to the average individual. A great number of books have been written on financial markets and investments. Below are my top 5 financial books that every individual should read.
The Intelligent Investor
Author: Benjamin Graham
A bible for value investors the world over, the book is described by Warren Buffet as “by far the best book ever written on investing”. In the Intelligent Investor, Benjamin Graham explains the concept of value investing, which focuses on generating steady, long-term profits by investing at companies that are available at a discount to their intrinsic value and by ignoring current market volatility.
One Up On Wall Street
Author: Peter Lynch
A personal investment literature classic, “One up on Wall Street”, is simple, relatable and dishes out some clever gems. While the takeaways from the book are myriad the key ones urge investors to invest in good firms by doing their own due diligence and research and ignore stock market fluctuations. The book also encourages investors to evaluate simple companies that appear dull, mundane or out of favour, and haven’t caught the street. Most important of all, it asks you to evaluate the kind of investor you are and the kind of investor you want to be.
The Little Book That Still Beats the Market
Author: Joel Greenblatt
Penned by the legendary Joel Greenblatt, this book is a classic that follows in Benjamin Graham’s footsteps, exulting value investing as the best way to make money in the stock markets. This book is for every individual who thinks that investing is akin to rocket science, difficult to master. Written in the simplest of manners, “The Little Book That Still Beats the Market” suggests a step-by-step tutorial to implement a simple, mathematical formula when buying stocks which guarantees long-term profits.
A Random Walk Down Wall Street
Author: Burton Malkiel
In his book, “A Random Walk Down Wall Street”, Burton Malkiel proposed the then revolutionary theory that historical prices have no predictive power. He also suggests that investors are “better off buying and holding a diversified portfolio rather than trying to beat the market by purchasing individual stocks or actively managed mutual funds.” In the book, he tackles and dispels a number of investing axioms, superstitions and truisms. The book also addresses the popular divide between technical analysis and fundamental analysis.
The Richest Man in Babylon
Author: George S Clason
Wealth creation and preservation have been the goal of mankind since time immemorial. Narrated as a delightful set of parables, George Clason's “The Richest Man in Babylon” explain the basics of money and reveals ancient secrets to wealth creation and wealth preservation. First appearing as financial management pamphlets, these timeless principles were eventually bound into a book that is likely to appeal to both novice, as well as, seasoned investors.
