“A book is a gift you can open again and again.” Garrison Keillor
Books are the best companion to knowledge savvy investors. Value investing is not a knowledge but it is an art inspiring by passion and knowledge. There are several books available on investments, but very few motivational books available on value investing. Such books have a history of decades and still favorites of value investors across the world. In my findings, I have found Top 5 Inspiring Books on Value Investing, most of them are still classic and some of them are fantastic but still no most of the value investors even not heard the title about. It is a right collection to acquire to your library as a classic collection.
Each of the investing books in this lists have its own specialty. None of them duplicates any points in this guides. Each of this guides are special with the subject covering in it. A combination of this guides can provide enormous knowledge to any investor to be a perfect value investor. Have a look on the list below:
Top 5 Inspirational Books on Value Investing
1. The Intelligent Investor
The Intelligent investor written by Benjamin Graham, ‘Father of Value Investing’, published in 1949 considers an an investment classics that remain bestsellers to this day. I don’t remember how many times I have read this book. I still reading this precious value investing bible. It can consider as the king of all value investing books ever published in the world. Benjamin Grahams 2 most famous allegories, ‘Mr. Market’ and ‘Margin of Safety’ originally introduced to the investing world through this guide only. The Intelligent Investor considered as a must read for any person serious about investing in the stock market. While this book is not meant for a beginner, reading it does give plenty of structure to help you organize your approach to value investing. Buy this guide
2. Common Stocks and uncommon Profits
“Common Stocks and uncommon Profits” written by American investment genius Philip Arthur Fisher, well known as Philip Fisher, originally published in 1958. Philip Fisher considered as a pioneer in the field of Growth Investing. When I have completed reading the book about 5 times, I have equipped with must have qualities for selecting a business to invest and upon completion of my reading to 10 times, it made me difficult to find a company to invest. Quality of his advise in this guide on the selection of a business is something unexplainable, thrilling and deep penetrating with wonderful knowledge. As the only author highly admired by legend investor Warren Buffett for his classic writing and knowledge, Philip Fisher provided eight cutting edge investing principles to the investors for successful investing. Any true follower of the investment advice and style of Philip Fisher, will be able to make investments ‘for ever’. Buy this guide
3. Security Analysis
“Security Analysis” is a trough but ever best qualitative and quantitative business analysis guide from Benjamin Graham. First edition of ‘Security Analysis’ published in 1934, no investment book in history had either the immediate impact, or the long-term relevance and value, of its first edition in 1934. It was among few guide continuously in print for more than sixty years from its original publication and one of the most admired and most discussed analysis guide in this world. When it come to the original focus of this book, it is a timeless guidance and advice to analyze business quality through careful analysis of balance sheets. The one who have read and familiar about Security Analysis will be able to understand any trap or errors in the balance sheet immediately. When I have read the guide as first, it was difficult for me to understand the intelligent methods Graham explaining to stimulate our analyzing power. When I have went through multiple times, it put me to the most comfortable side to analyze and understand the balance sheet to a great degree. While the guide covering bond investing, Graham explained the difference of valuation points on each bond and equity to analyze the business using right factors. It is a must read as well as a pearl in investment library. Buy this guide
4. Common Stocks as Long Term Investments
I am certain that most of the readers might haven’t heard about this valuable investment guide. “Common Stocks as Long Term Investments” is a masterpiece of Edgar Lawrence Smith originally published in 1928. The studies found in this book are the record of a failure, the failure of facts to sustain a preconceived theory. Bonds have certain attributes. A diversification of common stocks has its own attributes, which differs from bonds. Each class of investment has its useful purpose and its proper place in any investment plan. A clearer understanding of their differing attributes may help to determine the relative proportion of each of these two classes of securities which will best serve the investment requirements and purposes of each investor. This book not being famous with investors because of its age as an old investing guide. Reading this guide provide you enormous knowledge on each and every factors need to be pointed when analyzing bonds or stocks.
In this investing guide, smith concluded three reasons why stocks beat bonds as long term investments:First: inflation is more likely than deflation and bonds don’t have any protection against inflation. In inflationary times bonds lose purchasing power even as the face value remains the same. Stocks, to the contrary, grow in value often beyond inflation as I will explain below. Second: for a bond to qualify as high grade, the issuing company has to have earnings above and beyond what is required to pay off the interest and the principal of the bond and this extra income accrues to the stockholders, not to the bond holders. Third: population growth requires growth of products and services and the companies that provide them grow accordingly. Improving standard of living has the same effect, people demand more and better products and services and the companies supplying them grow accordingly. This growth is above and beyond inflation as otherwise there would be no improvement in the standard of living, quite the contrary.
5. The Theory of Investment Value
Finally, “The Theory of Investment Value” is a work from John Burr Williams first printed in 1938 famous on ‘Dividend Discount Model’. More than a book “The Theory of Investment Value” was a Ph.D. thesis at Harvard in 1937. In his 1992 published Capital Ideas, Peter Bernstein says “Williams combined original theoretical concepts with enlightening and entertaining commentary based on his own experiences in the rough-and-tumble world of investment.” Williams’ discovery was to project an estimate that offers intrinsic value and it is called the ‘Dividend Discount Model’ which is still used today by professional investors on the institutional side of markets. “The Theory of Investment Value” is still in print almost seven decades after it was first published, as a serious academic works on valuation, shows you how to calculate intrinsic value and is full of math. Any math savvy investor must go for this guide.
As a value investor, to get exact knowledge, above mentioned books are worth having and reading. Most of them are not a kind of book to read once to keep somewhere. Each of this guide teaching knowledge on various subjects and as the sole authority on what it is teaching. Buy, read and add to your investment collection for referring time to time, provide you enormous knowledge and wisdom.
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