My original TOP 40

As a private investor I always think of how can we learn more about investing. Having a profitable investment is what most people look forward to. The stock market is definitely the best place to invest in for the long run. The 40 books you will see are in my opinion the best choice. I have read them all and I still look into them. At home I have around 60 but this selection will help you to become a better investor, but will also give you an inside about the market and the players (investors) who are out there.

1. The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition)
Among the library of investment books promising no-fail strategies for riches, Benjamin Graham's classic, The Intelligent Investor, offers no guarantees or gimmicks but overflows with the wisdom at the core of all good portfolio management.

The hallmark of Graham's philosophy is not profit maximization but loss minimization. In this respect, The Intelligent Investor is a book for true investors, not speculators or day traders. He provides, "in a form suitable for the laymen, guidance in adoption and execution of an investment policy" (1). This policy is inherently for the longer term and requires a commitment of effort. Where the speculator follows market trends, the investor uses discipline, research, and his analytical ability to make unpopular but sound investments in bargains relative to current asset value. Graham coaches the investor to develop a rational plan for buying stocks and bonds, and he argues that this plan must be a bulwark against emotional behavior that will always be tempting during abrupt bull and bear markets.

Since it was first published in 1949, Graham's investment guide has sold over a million copies and has been praised by such luminaries as Warren E. Buffet as "the best book on investing ever written." These accolades are well deserved. In its new form--with commentary on each chapter and extensive footnotes prepared by senior Money editor, Jason Zweig--the classic is now updated in light of changes in investment vehicles and market activities since 1972. What remains is a better book. Graham's sage advice, analytical guides, and cautionary tales are still valid for the contemporary investor, and Zweig's commentaries demonstrate the relevance of Graham's principles in light of 1990s and early twenty-first century market trends. --Patrick O'Kelley



2. The Four Pillars of Investing: Lessons for Building a Winning Portfolio
Sound, sensible advice from a hero to frustrated investors everywhere William Bernstein's The Four Pillars of Investing gives investors the tools they need to construct top-returning portfolios without the help of a financial adviser. In a relaxed, nonthreatening style, Dr. Bernstein provides a distinctive blend of market history, investing theory, and behavioral finance, one designed to help every investor become more self-sufficient and make better informed investment decisions. The 4 Pillars of Investing explains how any investor can build a solid foundation for investing by focusing on four essential lessons, each building upon the other. Containing all of the tools needed to achieve investing success, without the help of a financial advisor, it presents:
• Practical investing advice based on fascinating history lessons from the market
• Exercises to determine risk tolerance as an investor
• An easy-to-understand explanation of risk and reward in the capital markets



3. A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing
The million-copy bestseller, revised and updated with new investment strategies for retirement and the insights of behavioral finance. Updated with a new chapter that draws on behavioral finance, the field that studies the psychology of investment decisions, here is the best-selling, authoritative, and gimmick-free guide to investing. Burton Malkiel evaluates the full range of investment opportunities, from stocks, bonds, and money markets to real estate investment trusts and insurance, home ownership, and tangible assets such as gold and collectibles. This edition includes new strategies for rearranging your portfolio for retirement, along with the book’s classic life-cycle guide to investing, which matches the needs of investors in any age bracket. A Random Walk Down Wall Street long ago established itself as a must-read, the first book to purchase before starting a portfolio. So whether you want to brief yourself on the ways of the market before talking to a broker or follow Malkiel’s easy steps to managing your own portfolio, this book remains the best investing guide money can buy.



4. Common Stocks and Uncommon Profits and Other WritingsWidely respected and admired, Philip Fisher is among the most influential investors of all time. His investment philosophies, introduced almost forty years ago, are not only studied and applied by today's financiers and investors, but are also regarded by many as gospel. This book is invaluable reading and has been since it was first published in 1958. The updated paperback retains the investment wisdom of the original edition and includes the perspectives of the author's son Ken Fisher, an investment guru in his own right in an expanded preface and introduction
"I sought out Phil Fisher after reading his Common Stocks and Uncommon Profits...A thorough understanding of the business, obtained by using Phil's techniques...enables one to make intelligent investment commitments."
Warren Buffet



5. Contrarian Investment Strategies - The Next Generation
Manager of the Kemper-Dreman High Return Fund and chair and CEO of Dreman Value Management, Dreman analyzes contrarian investment strategies for the 1990s and into the 21st century, defining contrarian investment as involving buying and selling securities by going against the crowd and prevailing investor opinions. He emphasizes the importance of investor psychology, which he terms "the necessary link required to activate the contrarian strategies we will now examine." Additionally, Dreman describes investor overreaction as a response to events in a predictable fashion: investors "consistently overvalue the prospects of `best' investments and undervalue those of the `worst.'" He presents and discusses 41 contrarian investment rules involving such factors as stock performance, political and financial crises, volatility, and analysts' forecasts. Especially interesting are the specific case studies involving the effect on the securities markets of major crises such as the 1987 stock market "crash" and the Gulf War. Highly recommended for business collections in both public and academic libraries. Lucy T. Heckman, St. John's Univ. Lib., Jamaica,



6. Beating the Street
As former head of the Magellan Fund, the most successful equity mutual fund in the country when he rain it, as well as current trustee of the Fidelity group of funds - Peter Lynch is THE source for stock and mutual fund investing. In Beating the Street, Lynch's goal is simple: to teach you how to have more money tomorrow than you have today. He believes success depends on an investor's ability to ignore the worries of the world long enough to allow their investments to succeed. Lynch provides sound advice on the following topics:
• Shopping for stocks: why shopping malls are great investment guides
• Looking for a few good stocks: how some investments lead to others
• Prospecting in bad news: why conventional wisdom may not be the final word
Offering a one-on-one consultation with one of the most successful stock analysts around, Beating the Street will help you make the right investment choices.



7. The Ultimate Dividend Playbook: Income, Insight and Independence for Today's Investor
Many people believe that the key to success in the stock market is buying low and selling high. But how many investors have the time, talent, and luck to earn consistent returns this way? In The Ultimate Dividend Playbook: Income, Insight, and Independence for Today’s Investor, Josh Peters, editor of the monthly Morningstar DividendInvestor newsletter, shows you why you don’t have to try to beat the market and how you can use dividends to capture the income and growth you seek.



8. Reminiscences of a Stock Operator (Wiley Investment Classics)
Stock investing is a relatively recent phenomenon and the inventory of true classics is somewhat slim. When asked, people in the know will always list books by Benjamin Graham, Burton G. Malkiel's A Random Walk Down Wall Street, and Common Stocks and Uncommon Profits and Other Writings by Philip A. Fisher. You'll know you're getting really good advice if they also mention Reminiscences of a Stock Operator by Edwin Lefèvre. Reminiscences of a Stock Operator is the thinly disguised biography of Jesse Livermore, a remarkable character who first started speculating in New England bucket shops at the turn of the century. Livermore, who was banned from these shady operations because of his winning ways, soon moved to Wall Street where he made and lost his fortune several times over. What makes this book so valuable are the observations that Lefèvre records about investing, speculating, and the nature of the market itself. For example:
"It never was my thinking that made the big money for me. It always was my sitting. Got that? My sitting tight! It is no trick at all to be right on the market. You always find lots of early bulls in bull markets and early bears in bear markets. I've known many men who were right at exactly the right time, and began buying or selling stocks when prices were at the very level which should show the greatest profit. And their experience invariably matched mine--that is, they made no real money out of it. Men who can both be right and sit tight are uncommon."
If you've ever spent weekends and nights puzzling over whether to buy, sell, or hold a position in whatever investment--be it stock, bonds, or pork bellies, you'll be glad that you read this book. Reminiscences of a Stock Operator is full of lessons that are as relevant today as they were in 1923 then the book was first published. Highly recommended. --Harry C. Edwards --



9. Your Money and Your Brain: How the New Science of Neuroeconomics Can Help Make You Rich
Do you fret over the value of your investments on a daily basis? Do you buy stocks based on a "hunch" or a gut feeling? According to Zweig, the latest scientific evidence shows that this common behavior usually results in financial loss and is caused by the way our brain reacts when we think about money. According to recent research in the emerging science of "neuroeconomics," the pleasure center in the brain that is stimulated in anticipation of "the big payout" is the same area that is affected during sex or drug use and is responsible for the addiction to gambling. Our brains, which evolved more than 200,000 years ago to react quickly to patterns and minute changes in our environment, are not equipped to handle the randomness of the stock market; but nevertheless we attempt to create meaningful patterns where there are none and base our investment decisions on erroneous assumptions. The good news is that awareness of this phenomenon can make us better investors, and Zweig offers some simple tips to avoid the pitfalls, such as taking the long view and avoiding overtrading. Siegfried, David --



10. How to Make Money in Stocks: A Winning System in Good Times and Bad, Fourth Edition
A BUSINESSWEEK BESTSELLER!
Anyone can learn to invest wisely with this bestselling investment system!
Through every type of market, William J. O’Neil’s national bestseller, How to Make Money in Stocks, has shown over 2 million investors the secrets to building wealth. O’Neil’s powerful CAN SLIM® Investing System—a proven 7-step process for minimizing risk and maximizing gains—has influenced generations of investors.
Based on a major study of market winners from 1880 to 2009, this expanded edition gives you:
• Proven techniques for finding winning stocks before they make big price gains
• Tips on picking the best stocks, mutual funds, and ETFs to maximize your gains
• 100 new charts to help you spot today’s most profitable trends
PLUS strategies to help you avoid the 21 most common investor mistakes!
“I dedicated the 2004 Stock Trader’s Almanac to Bill O’Neil: ‘His foresight, innovation, and disciplined approach to stock market investing will influence investors and traders for generations to come.’”
—Yale Hirsch, publisher and editor, Stock Trader’s Almanac and author of Let’s Change the World Inc.
“Investor’s Business Daily has provided a quarter-century of great financial journalism and investing strategies.”
—David Callaway, editor-in-chief, MarketWatch
“How to Make Money in Stocks is a classic. Any investor serious about making money in the market ought to read it.”
—Larry Kudlow, host, CNBC’s "The Kudlow Report"



11. The Successful Investor: What 80 Million People Need to Know to Invest Profitably and Avoid Big Losses
Simple-to-follow strategies for making--and keeping--profits in today's perilous stock market.
More than 80 million investors lost 50 to 80 percent of their savings in the recent stock market crash. Investor's Business Daily publisher William J. O'Neil, however, was one of the first to see--and warn investors about--the dangers inherent in what had been, up to that point, a historic bull market run. Those who followed his counsel were able to sidestep devastating losses and emerge with their sizable bull market profits largely intact.
In The Successful Investor, O'Neil steps up to tell all investors how they can make money and, more important, avoid losses in up markets, down markets, and everything in between. Showing how mistakes made in the recent market collapse were amazingly similar to those made in previous down cycles, O'Neil reveals simple steps investors can follow to avoid costly mistakes and:
• Buy only the best stocks at only the best times
• Follow a market-tested 3-to-1 Profit-and-Loss Percentage Plan
• Know when to sell for the biggest possible profit
• Recognize chart patterns that presage enormous market moves
• Manage a portfolio over time to maximize its returns
William O'Neil has succeeded in virtually every market environment by following a stable, nonemotional investment plan. In his latest book, O'Neil explains how anyone can follow that plan to become a profitable long-term investor, regardless of market tides or turns. The Successful Investor will bring reason and welcome relief to all investors buffeted and bewildered by the perils and uncertainty of today's stock market.



12. How I Made $2,000,000 in the Stock Market
Annotation: 2009 reprint of 1960 edition. Hungarian by birth, Nicolas Darvas trained as an economist at the University of Budapest. Reluctant to remain in Hungary until either the Nazis or the Soviets took over, he fled at the age of 23 with a forged exit visa and fifty pounds sterling to stave off hunger in Istanbul, Turkey. During his off hours as a dancer, he read some 200 books on the market and the great speculators, spending as much as eight hours a day studying.Darvas ploughed his money into a couple of stocks that had been hitting their 52-week high. He was utterly surprised that the stocks continued to rise and subsequently sold them to make a large profit. His main source of stock selection was Barron's Magazine. At the age of 39, after accumulating his fortune, Darvas documented his techniques in the book, How I Made 2,000,000 in the Stock Market. The book describes his unique "Box System", which he used to buy and sell stocks. Darvas' book remains a classic stock market text to this day.



13. The New Market Wizards: Conversations with America's Top Traders
In these absorbing interviews with star performers in the financial markets, Schwager ( Market Wizards ) humanizes the mechanics and psychology behind billion-dollar daily world trading in such sophisticated instruments as currencies, stock options, commodity futures, and mutual-fund accounts by individuals, investment firms and group-trading computerized "money machines." One trader focuses on market response to news events, another calculates mathematical probabilities--one even cocks an ear to the noise level on the exchange floor. All rank assiduous research, self-confidence, a specific plan and the courage to cut losses among essentials to success. Few consider their work gambling, but Schwager entertainingly argues that a successful trader needs many of the qualities of a good poker player. Though the subject matter is esoteric, there is much here to attract the general reader, and Schwager appends a "primer" of technical basics.



14. Super Trader: Make Consistent Profits in Good and Bad Markets
How do you transform yourself from mild-mannered investor to Super Trader? Think clearly. Plan accordingly. Commit completely. In other words, become a trader. And no one is better suited to help you make the transformation than legendary trading educator and author Van K. Tharp.
Combining the sharp insight and technical brilliance that has drawn legions of investors to his books and seminars, Tharp provides a holistic approach for becoming a successful full-time trader. His system—a meld of investing psychology and sound trading practice—is the secret to achieving optimum conditions that produce results in both bull and bear markets.
Using the lessons of Super Trader, you will approach trading as you would a small business—realistically, systematically, and enthusiastically. Drawing on his decades of experience, Tharp has created a simple plan designed to help anyone master the market. You can put this plan to use immediately in order to:
• Master the psychology of trading
• Craft a “business plan”—a working document to guide your trading
• Develop a trading system tailored for your personal needs and skills
• Create position-sizing strategies to meet your objectives
• Monitor yourself constantly to minimize mistakes
Throughout the book, Tharp asks the pertinent questions you must ask yourself about becoming a trader, being a trader, and succeeding as a trader.
The rewards that come with being a Super Trader—both financial and personal—make you feel as if you can leap small buildings in a single bound. Whatever your skill level, Tharp provides the formula for succeeding in a field where most people fail.



15. The Complete TurtleTrader: How 23 Novice Investors Became Overnight Millionaires
Covel (Trend Following) revisits a famous financial trading experiment conducted by Wall Street trader Richard Dennis and extracts its lessons with mixed results. Dennis, who quickly learned how to trade after starting as a runner at the Chicago Mercantile Exchange in 1966 at age 17, had made a reported $200 million by 1983. To settle an argument with fellow trader William Eckhardt about whether trading ability was innate or could be taught, he put an ad in the Wall Street Journal offering to teach candidates how to trade in two weeks, and then backed them with his own money. Of the thousands of people who who applied, 23 turtles were accepted. Their trading made $100 million for Dennis, leading some to become highly successful traders in their own right. Having tracked down most of the people involved, Covel describes the turtle training, including rules for entering and exiting trades as well as Dennis and Eckhardt's personal lessons, and speculates on why some turtles succeeded more than others. However, there are too many characters with competing interests, and many missing facts. Covel's own strong views can also get more emphasis than the voices of the principals. Still, the book is a useful training manual distilling the lessons of a fascinating experiment.



16. A Bull in China: Investing Profitably in the World's Greatest Market
If the twentieth century was the American century, then the twenty-first century belongs to China. Now the one and only Jim Rogers shows how any investor can get in on the ground floor of “the greatest economic boom since England’s Industrial Revolution.”

In this indispensable new book, one of the world’s most successful investors, Jim Rogers, brings his unerring investment acumen to bear on this huge and unruly land now being opened to the world and exploding in potential.

Rogers didn’t just wake up a Sinophile yesterday. He’s been tracking the Chinese economy since he first went to China in 1984 in preparation for his round-the-world motorcycle trip and then again, later, when he saw Shanghai’s newly reopened stock exchange (which looked like an OTB office). In the decades that followed–especially in recent years, with the easing of Communist party financial dictates–the facts speak for themselves:
• The Chinese economy’s growth rate has averaged 9 percent since the start of the 1980s.
• China’s savings rate is over 35 percent (in America, it’s 2 percent).
• 40 percent of China’s output goes to exports (so there’s no crippling foreign debt).
• $60 billion a year in direct foreign investment, combined with a trade surplus, has brought Beijing’s foreign currency reserves to over $1 trillion.
• China’s fixed assets–ports, bridges, and roads–double every two and a half years.

In short, if projections hold, China will surpass the United States as the world’s largest economy in as little as twenty years. But the time to act is now. In A Bull in China, you’ll learn what industries offer the newest and best opportunities, from power, energy, and agriculture to tourism, water, and infrastructure. In his trademark down-to-earth style, Rogers demystifies the state policies that are driving earnings and innovation, takes the intimidation factor out of the A-shares, B-shares, and ADRs of Chinese offerings, and encourages any reader to trust his or her own expertise (if you’re a car mechanic, check out their auto industry).

A Bull in China also features fascinating profiles of “Red Chip” companies, such as Yantu Changyu, China’s largest winemaker, which sells a “Healthy Liquor” line mixed with herbal medicines. Plus, if you want to export something to China yourself–or even buy land there–Rogers tells you the steps you need to take.

No other book–and no other author–can better help you benefit from the new Chinese revolution. Jim Rogers shows you how to make the “amazing energy, potential, and entrepreneurial spirit of a billion people” work for you.



17. Hot Commodities: How Anyone Can Invest Profitably in the World's Best Market
According to Jim Rogers, "commodities get no respect." Here are a few reasons why he thinks they should: they are easier to comprehend and study than stocks and behave more rationally since they are subject to the basic laws of supply and demand; they have outperformed many other investment options in recent years; it is foolish to ignore an entire sector of the marketplace; and a bull market is currently under way in commodities--a trend that Rogers expects to last for a least a decade longer. Further, Rogers believes that you cannot be a successful investor in stocks, bonds, or currencies without an understanding of commodities. Hot Commodities: How Anyone Can Invest Profitably in the World's Best Market is designed to introduce the novice to the basics of investing in commodities as well as explain what they are and why they are important. In doing so, he shatters some myths about the relative risks of commodities, explains the relationship between the stock and commodities markets, and provides a succinct analysis and history of the global oil, gold, lead, sugar, and coffee markets.
Rogers also offers practical advice and information for beginners, including the best resources, how to read the commodities reports in the newspaper or on television, the various ways to open an account, information on index funds (such as Rogers' own index fund that he started in 1998), mechanisms, terminology, and other vital details people must know before investing. Clearly written and entertaining, Hot Commodities offers a solid introduction to investments that many people, including financial advisors, fail to give the proper respect. --Shawn Carkonen --



18. Crash Proof 2.0: How to Profit From the Economic Collapse
A fully updated follow-up to Peter Schiff's bestselling financial survival guide-Crash Proof, which described the U.S. economy as a house of cards on the verge of collapse, with over 80 pages of new material. The economic and monetary disaster which seasoned Wall Street prognosticator Peter Schiff predicted is no longer hypothetical-it is here today. And nobody understands what to do in this situation better than the man who saw it coming. For more than a decade, Schiff has not only observed the U.S. economy, but also helped his clients restructure their portfolios to reflect his outlook. What he sees today is a nation facing an economic storm brought on by growing federal, personal, and corporate debt; too little savings; and a declining dollar.
Crash Proof 2.0 picks up right where the first edition-a bestselling book that predicted the current market mayhem-left off. This timely guide takes into account the dramatic economic shifts that are reshaping America and provides you with the insights and information to navigate the dangerous terrain. Throughout the book, Schiff explains the factors that will affect your future financial stability and offers a specific three step plan to battle the current economic downturn.
• Discusses the measures you can take to protect yourself-as well as profit-during these difficult times
• Offers an insightful examination of the structural weaknesses underlying the economic meltdown
• Outlines a plan that will allow you to preserve wealth and protect the purchasing power of your savings
• Other titles by Schiff: Crash Proof and The Little Book of Bull Moves in Bear Markets
Filled with in-depth insights and expert advice, Crash Proof 2.0 will help you survive and thrive during the coming years of economic uncertainty.



19. One Up On Wall Street : How To Use What You Already Know To Make Money In The Market
Lynch, director of the Fidelity Magellan Fund, the nation's largest equity fund ($9 billion in assets), argues that average investors can beat Wall Street professionals by using the information that they encounter in their everyday lives. For example, Lynch invested in Hanes after his wife told him about the popularity of L'eggs pantyhose. Other winning stocks that average investors could have picked well before Wall Street became aware of them include LaQuinta motels, the Limited clothing store chain and Agency Rent-A-Car, note the authors. They advise readers to look for spectacular growth among companies that sound dull; do something disagreeable; are spinoffs; are buying back their own stock. They caution readers to avoid companies touted as the next IBM or Xerox; that are diversifying ("diworseifying"); that depend on a single customer. The book is also a primer on how the stock market works and is written in a light, entertaining style.



20. The Panic of 1907: Lessons Learned from the Market's Perfect Storm
Though business professors Bruner and Carr approach their subject, the spectacular financial crisis that gave America the FDIC and the Federal Reserve, with grave pedantry, they devote the majority of the book to the more colorful events and personalities of the crisis, which even academic prose cannot dull. The chronicle follows one speculator's attempt to corner the copper market, which leads to panic, the failure of banks and trusts and the impending bankruptcy of New York City. In the midst of chaos, one man was able to halt the domino effect with calm, character and capital: J. Pierpont Morgan. The Panic, the authors note, hit America at a moment eerily similar to our own: coming off 50 years of postwar economic expansion with a Republican "moralist" in the White House, an increasingly interventionist government, the formation of enormous new corporate conglomerates and a muckraking news media fueling resentment.



21. Freakonomics : A Rogue Economist Explores the Hidden Side of Everything
Forget your image of an economist as a crusty professor worried about fluctuating interest rates: Levitt focuses his attention on more intimate real-world issues, like whether reading to your baby will make her a better student. Recognition by fellow economists as one of the best young minds in his field led to a profile in the New York Times, written by Dubner, and that original article serves as a broad outline for an expanded look at Levitt's search for the hidden incentives behind all sorts of behavior. There isn't really a grand theory of everything here, except perhaps the suggestion that self-styled experts have a vested interest in promoting conventional wisdom even when it's wrong. Instead, Dubner and Levitt deconstruct everything from the organizational structure of drug-dealing gangs to baby-naming patterns. Underlying all these research subjects is a belief that complex phenomena can be understood if we find the right perspective. Levitt has a knack for making that principle relevant to our daily lives, which could make this book a hit. Malcolm Gladwell blurbs that Levitt "has the most interesting mind in America."



22. Liar's Poker: Rising Through the Wreckage on Wall Street
As described by Lewis, liar's poker is a game played in idle moments by workers on Wall Street, the objective of which is to reward trickery and deceit. With this as a metaphor, Lewis describes his four years with the Wall Street firm Salomon Brothers, from his bizarre hiring through the training program to his years as a successful bond trader. Lewis illustrates how economic decisions made at the national level changed securities markets and made bonds the most lucrative game on the Street. His description of the firm's personalities and of the events from 1984 through the crash of October 1987 are vivid and memorable. Readers of Tom Wolfe's The Bonfire of the Vanities ( LJ 11/15/87) are likely to enjoy this personal memoir.



23. Moneyball: The Art of Winning an Unfair Game
Lewis (Liar's Poker; The New New Thing) examines how in 2002 the Oakland Athletics achieved a spectacular winning record while having the smallest player payroll of any major league baseball team. Given the heavily publicized salaries of players for teams like the Boston Red Sox or New York Yankees, baseball insiders and fans assume that the biggest talents deserve and get the biggest salaries. However, argues Lewis, little-known numbers and statistics matter more. Lewis discusses Bill James and his annual stats newsletter, Baseball Abstract, along with other mathematical analysis of the game. Surprisingly, though, most managers have not paid attention to this research, except for Billy Beane, general manager of the A's and a former player; according to Lewis, "[B]y the beginning of the 2002 season, the Oakland A's, by winning so much with so little, had become something of an embarrassment to Bud Selig and, by extension, Major League Baseball." The team's success is actually a shrewd combination of luck, careful player choices and Beane's first-rate negotiating skills. Beane knows which players are likely to be traded by other teams, and he manages to involve himself even when the trade is unconnected to the A's. " `Trawling' is what he called this activity," writes Lewis. "His constant chatter was a way of keeping tabs on the body of information critical to his trading success." Lewis chronicles Beane's life, focusing on his uncanny ability to find and sign the right players. His descriptive writing allows Beane and the others in the lively cast of baseball characters to come alive.



24. When Genius Failed: The Rise and Fall of Long-Term Capital Management
In late September 1998, the New York Federal Reserve Bank invited a number of major Wall Street investment banks to enter a consortium to fund the multibillion-dollar bailout of a troubled hedge fund. No sooner was the $3.6-billion plan announced than questions arose about why usually independent banks would band together to save a single privately held fund. The short answer is that the banks feared that the fund's collapse could destabilize the entire stock market. The long answer, which Lowenstein (Buffett) provides in undigested detail, may panic those who shudder at the thought of bouncing a $200 check. Long-Term Capital Management opened for business in February 1994 with $1.25 billion in funds. Armed with the cachet of its founders' stellar credentials (Robert Merton and Myron Scholes, 1997 Nobel Prize laureates in economics, were among the partners), it quickly parlayed expertise at reading computer models of financial markets and seemingly limitless access to financing into stunning results. By the end of 1995, it had tripled its equity capital and total assets had grown to $102 billion. Lowenstein argues that this kind of success served to enhance the fund's golden legend and sent the partners' self-confidence off the charts. As he itemizes the complex mix of investments and heavy borrowing that made 1994-1997 profitable years, Lowenstein also charts the subtle drift toward riskier (and ultimately disastrous) ventures as the fund's traditional profit centers dried up. What should have been a gripping story, however, has been poorly handled by Lowenstein, who obscures his narrative with masses of data and overwritten prose.



25. Barbarians at the Gate: The Fall of RJR Nabisco
The leveraged buyout of the RJR Nabisco Corporation for $25 billion is a landmark in American business history, a story of avarice on an epic scale. Two versions of the fierce competition for the largest buyout ever consummated are presented by skilled journalists with contrasting styles. Burrough and Helyar are clearly fascinated with the personalities of the players in the deal and with the trappings of corporate wealth. The restless, flamboyant personality of Ross Johnson, CEO of RJR Nabisco, is portrayed as the key to the events that were to unfold. The colorful description of all of the players and the events will likely have broad appeal. Lampert signals the complexity of her story by introducing her narrative with a three-page cast of characters. Her focus on the strategy of the players and on the fast-paced action provides a more concise description of a deal big enough to augment the wealth of many rich people. Business libraries will want both versions of this story of capitalism drawn to the extreme, but students, looking for a more comprehensive treatment, will favor Lampert's version.



26. The Predators' Ball: The Inside Story of Drexel Burnham and the Rise of the Junk Bond Raiders
The Predators' Ball tells that story of corporate raiders, who were people that basically bought up companies that were not doing to well, revamped them and then sold them for profit. This tells the story of one of those raiders that got blindsided by lawsuits from the SEC for numerous financial crimes and subsequently saw their empire crumble. I liked this book because it showed what can happen when people get wrapped in the guts and glory that is Wall Street. Most people would like think that anyone who went from being poor to rich would retain some sort humble nature. This is not true. Most people would just forget about it and continue. Furthermore, they tend to think that the law does not apply to them and will do anything for a quick buck. I think that this book displayed that idea pretty well. I would reccomend this book to anyone who wants to see an early example of a financial crisis and an example of when people get too entangled in wealth and power.



27. Monkey Business: Swinging Through the Wall Street Jungle
Time was when you took a job that you realized was not for you, you made the best of it and moved on. Now, though, you get your bitter revenge by writing a book trashing your former employer and coworkers. Rolfe and Troob worked as associates at investment banking powerhouse Donaldson, Lufkin & Jenrette. It's hard to sympathize with the pair. Their first full-year compensation was about eight times what average college graduates earn at their first job, and they traveled by private jet, stayed in the best hotels, and ate in the best restaurants. On the other hand, they put in 20-hour days, suffered the abuse of "rabid, power-mad bosses," and lacked meaningful personal lives. Relying heavily on "frat-house" humor, they tell the tale of their brief careers. Rolfe and Troob do provide some insight into what investment bankers do, and their story may serve as a warning to others considering entering the field. But if, as they claim, business school graduates are clamoring for such jobs, this warning will fall on deaf ears. David Rouse --



28. Den of Thieves
Michael Milken, Ivan Boesky, Martin Siegel, and Dennis Levine will long be remembered for the Wall Street insider trading scandals of the 1980s. Stewart, a Pulitzer Prize-winning Wall Street Jour nal reporter who covered the various scandals, has used his reportage as well as an exhaustive culling of court documents, testimony, and interviews with all of the participants to fashion an authoritative account of what happened. Stewart has done a thorough job in assembling the facts and has made connections that may surprise some readers. For example, Milken, the Drexel Burnham Lambert junk bond king who convinced many savings institutions and insurance companies to buy these bonds in large quantities, may have indirectly contributed not only to the bailout of various thrifts but also to the insolvency of some insurance companies. While this is a well-researched and highly readable work, there is such an abundance of financial details that a glossary of terms and related Wall Street jargon would have been helpful. This minor caveat aside, Stewart's contemporary morality tale is recommended for all business collections in public, special, and academic libraries.



29. Buffett: The Making of an American Capitalist
By picking the right stocks and businesses to invest in, plainspoken Nebraskan Warren Buffett became the richest man in the U.S. In this excellent biography, Wall Street Journal reporter Lowenstein details the billionaire stock market wizard's strategy of betting on the long-term growth of a handful of successful companies such as American Express and Berkshire Hathaway. Providing personal glimpses of a very private man, Lowenstein unearths childhood traumas such as the tormenting rages of Buffett's mother and his forced relocation to Washington, D.C., in 1943, where, at 13, he ran away from home (he was found by the police the next day). Buffett's wife, Susan Thompson, a nightclub singer, walked out on him in 1977 and was quickly replaced by his mistress, Latvian-born Astrid Menks. Lowenstein profiles an emotionally guarded, "strangely stunted" Midas obsessed with work and secrecy, who seemingly derives little pleasure from his fabulous wealth.



30. The 5 Keys to Value Investing
How to determine what stocks are really worth¬¬ and buy the best at a discount
"The Five Keys to Value Investing is practical, insightful, and a great roadmap to not only value investing but how to make money in the stock market." -- Joel Greenblatt, Managing Partner, Gotham Capital
"Jean-Jacques has written a great how-to guide for both beginning and experienced value investors. He skillfully draws on the canon and legacy of the great value investors, such as Graham and Buffett…a terrific addition on this time-tested methodology." -- Eric T. McKissack, Vice Chairman, Ariel Capital Management/Ariel Mutual Funds
Investors left to pick up the pieces of the shattered stock market are rediscovering value investing¬¬ the time-tested technique based on assessing and buying businesses as opposed to "picking" hot stocks. The Five Keys to Value Investing provides a methodical framework for using value analysis to uncover investment opportunities based on their business strengths, and building a solid portfolio of stocks that is destined to provide superior long-term returns.
Written by a professional value investor who worked for the best, The Five Keys to Value Investing explains how to answer the four basic questions of value investing:
• Does this stock represent a good business to own?
• What is its balance between price and value?
• What specific events will spur it to appreciate?
• What are the stock's safety levels?



31. Contrarian Investing: Buy and Sell When Others Won't and Make Money Doing It (New York Institute of Finance)
"The book does provide investors a valuable reality check in an age when the stock market continues to defy gravity". -- Teresa McUsic - Knight Ridder News Service
How to succeed and profit by NOT following conventional trends, that is the secret to Contrarian investing: buy assets that are out of favor. Here, Anthony Gallea a Contrarian with impressive credentials and William Patalon a savvy business writer -- explain this strategy for everyone in the market: novices and professionals alike.
Contrarian Investing gives readers the investing tips and techniques used by a portfolio manager overseeing $600 million in assets, with a track record for focusing on increasing returns while attempting to reduce risk. Written in a conversational style with exciting stories about big name but (at one time) out-of-favor stocks like Chrysler, IBM, Citicorp, and Xerox.
Gallea and Patalon show how the Contrarian approach can be systematized. They identify the key indicators backed by solid research that tell an investor when to buy and sell stocks. The authors have created a set of guidelines or trading rules that any investor can learn and put to immediate use.
Readers will understand:
Why Contrarian stock-picking works
How to identify a Contrarian stock
When to buy; when to sell
How to help reduce risk
And the key to Contrarian investing -- the psychology of investors



32. What Works on Wall Street : A Guide to the Best-Performing Investment Strategies of All Time
What Works On Wall Street is one of my favorite investment books. Previously, I had read Invest Like The Best, also by James P. O'Shaughnessy, and I wasn't overly impressed. Invest Like The Best made it sound as if all you needed was Value Screen, or some other online stock-screening software, and you would easily match and equal the best money managers, regardless of their investment strategy. This could be done because their portfolios always held certain types of stocks, such as high 5-year's earning growth rate stocks. Now obviously, great investors, like Peter Lynch, have portfolios that consist of different types of stocks, such as growth stocks and some value plays. So, such a strategy seemed at best naive. Worse, O'Shaughnessy made it sound like achieving 20% or great returns was child's play. My only conclusion was that O'Shaughnessy was a child of the great bull market of the later 1980's and 1990's and that he had little real knowledge to offer investors. Invest Like The Best seemed like a book that would mislead the new investor. So, I wasn't too impressed when I heard O'Shaughnessy had a new investing book out, What Works On Wall Street. I almost didn't read it, but heard good mentions of it from people whose investment experience I respected, so I decided to give the book a look. I'm glad I did!
What Works On Wall Street firmly establishes O'Shaughnessy as a premier researcher in the investment field. Using Standard & Poor's Compustat database, O'Shaughessy put together 50-stock portfolios of certain kinds of stocks (for example, the 50 lowest Price-to-sales ratio stocks, the highest Price-to-sales ratio stocks, etc.). He examined all the measures that most investors rely upon, including PSR's, P/E's, Price-to-cash-flow, Price-to-Book, etc.
The results showed that "value does will out." The strongest and best indicator of solid appreciation stocks were low PSR's (Price-to-Sales Ratios) which were pioneered by Ken Fisher in Super Stocks. Low PSR stocks sell for low multiples of their sales revenue. Next up in usefulness were the more complicated Price-to-cash-flow and price-to-book ratios. Again buying value based upon those criteria proved a winning strategy. Further, buying the high-priced stocks under any of these criteria lead to below average market returns. In other words, don't pay too much for your investments.
The portfolios were rebalanced annually. It was not surprising that overvalued stocks were punished in the long-run, or that stocks bought at value appreciated well, but what was shocking was the extent to which low PSR stocks blew away low P/E stocks. In other words, seeking value based upon low PSR was far more productive.
Exactly why this is still needs to be determined. Low PSR stocks should not only point to unpopular stocks, but also have a bias toward low-profit margin businesses, which is a stunning result. No compensation was made for the difference in average profit margins for different industries. So it is possible that low PSR served as a surrogate for some other factor, maybe turnaround companies, or stocks in trouble.
O'Shaughnessy then goes on to discuss relative strength stocks and growth-momentum measures. He shows how portfolios selected on multiple criteria can outperform portfolios selected on only a single criteria (such as low PSR). Given the annual rebalancing of the test portfolios, maybe having a strong relative strength stock makes sense and it certainly improved the results. But, one question remains: How do individual investors benefit from this knowledge?
One possibility would be to hold 50-stock portfolios and do as O'Shaughnessy recommends. However, many investors will not want to hold 50 stocks, nor rebalance their portfolios annually. For investors who buy-and-hold only a few select stocks, adopting O'Shaughessy's methods would demand a major change in thinking.
What Works On Wall Street also makes clear that criteria have different significance for different market capitalization stocks. In particular, small stocks and big stocks are not the same. Or, as many value investors already know, value is best applied to larger more established companies.
I have only touched upon a few of the findings of What Works On Wall Street. Overall, however, going from being unimpressed with his first book, to rethinking my own investment methods, I must say What Works On Wall Street earns my highest recommendation


33. The Black Swan: The Impact of the Highly Improbable
In business and government, major money is spent on prediction. Uselessly, according to Taleb, who administers a severe thrashing to MBA- and Nobel Prize-credentialed experts who make their living from economic forecasting. A financial trader and current rebel with a cause, Taleb is mathematically oriented and alludes to statistical concepts that underlie models of prediction, while his expressive energy is expended on roller-coaster passages, bordering on gleeful diatribes, on why experts are wrong. They neglect Taleb's metaphor of "the black swan," whose discovery invalidated the theory that all swans are white. Taleb rides this manifestation of the unpredicted event into a range of phenomena, such as why a book becomes a best-seller or how an entrepreneur becomes a billionaire, taking pit stops with philosophers who have addressed the meaning of the unexpected and confounding. Taleb projects a strong presence here that will tempt outside-the-box thinkers into giving him aStory of Risk look.



34. Against the Gods: The Remarkable
Risk management, which assumes that future risks can be understood, measured and to some extent predicted, is the focus of this solid, thoroughgoing history. Probability theory, pioneered by 17th-century French mathematicians Blaise Pascal and Pierre de Fermat, has made possible the design of great bridges, electric power utilities and insurance policies. The statistical sampling methods invented by dour Swiss scientist Jacob Bernoulli undergird diverse activities such as the testing of new drugs, stock-picking and wine tasting. Bernstein (Capital Ideas) animates his narrative with a colorful cast of risk-analyzers, including gambling addict Girolamo Cardano, 16th-century Italian physician to the Pope; and John Maynard Keynes, whose concerns over economic uncertainty compelled him to recommend an active, interventionist role for government. Bernstein also traces the development of business forecasting, game theory, insurance and derivatives, and surveys recent advances in risk forecasting made possible through chaos theory and by the development of neural networks.



35. Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets
If the prescriptions for getting rich that are outlined in books such as The Millionaire Next Door and Rich Dad Poor Dad are successful enough to make the books bestsellers, then one must ask, Why aren't there more millionaires? In Fooled by Randomness, Nassim Nicholas Taleb, a professional trader and mathematics professor, examines what randomness means in business and in life and why human beings are so prone to mistake dumb luck for consummate skill. This eccentric and highly personal exploration of the nature of randomness meanders from the court of Croesus and trading rooms in New York and London to Russian roulette, Monte Carlo engines, and the philosophy of Karl Popper. Part of what makes this book so good is Taleb's ability to make seemingly arcane mathematical concepts (at least to this reviewer) entirely relevant in evaluating and understanding everything from the stock market to the success of those millionaires cited in the aforementioned bestsellers. Here's an articulate, wise, and humorous meditation on the nature of success and failure that anyone who wants a little more of the former would do well to consider. Highly recommended. --Harry C. Edwards



36. The Warren Buffett Way, Second Edition
Hagstrom, a principal in a Philadelphia investment firm, describes the investment strategies and techniques used by Warren Buffett to realize enormous success as a professional investor. Aiming his analysis at the individual investor, Hagstrom reviews the influence of Buffett's mentors, Ben Graham and Philip Fisher, and illustrates Buffett's synthesis of their investment philosophies. Hagstrom provides case studies of Buffett's major investments, showing the qualities of the companies that had appeal. Buffett's investment philosophy espouses long-term investing, respect for good management, and recognition of the value of a business franchise. This insightful work is a worthwhile complement to Graham's classic writings, considered essential for new investors.



37. The Small-Cap Investor: Secrets to Winning Big with Small-Cap Stocks
Small-cap stocks, those publicly traded companies with market capitalizations less than $2 billion, can yield significant gains that are impossible to find in larger stocks. They've also proven to be among the most attractive investments after a financial downturn. Unfortunately, information about how to successfully invest in these smaller companies has been hard to find—until now.
Author Ian Wyatt is dedicated to helping investors find great companies at bargain prices before Wall Street or Main Street catches on. As the Chief Investment Strategist of SmallCapInvestor.com, he's guided countless individuals in their quest to capture small-cap investing success. Now, with The Small-Cap Investor, Wyatt will help you do the same.
Throughout the book, Wyatt clearly outlines his proven investment process and the systems that are involved—detailing eight straightforward steps you need to take to find, research, and analyze small-cap stocks that could put big gains in your portfolio. Page by page, he takes the time to explain the essential criteria involved in picking the right stocks and timing your buy/sell decisions. Topics touched upon include:
• Identifying growth trends and market sectors positioned for rapid growth in the years to come
• Secrets for finding undiscovered small caps before they are embraced by the financial media and institutional investors
• Understanding the fundamentals of a potential investment, including products, services, and management's ability to run the business
Along the way, Wyatt not only shows you how to find winners, but also addresses how to avoid losers. This is particularly important for investors who have experienced losses in their portfolios, and are looking to grow their portfolios in the coming years.
Many of today's top large-cap companies—from Microsoft to Wal-Mart—all started out small and grew to become dominant forces in their respective industries. Investors who bought these great companies early on profited handsomely. By following Wyatt's guidance, and understanding his strategies for finding winners, you'll have a huge edge over other investors and be in a better position to profit from the exponential growth of the right small-cap companies.



38. Confessions of a Street Addict
Cramer, famous for appearing on CNBC as the "wild excitable guy [with]... a big mouth and lots of passion talking authoritatively about how you could make money by getting on the Net," recounts his turbulent dual career as hedge fund manager and media pundit. Cramer tells of his lifelong obsession with the market, beginning with childhood scenes of poring over daily stock listings. The story kicks into high gear once he starts juggling his law school course load so he can spend as much time as possible trading (over the phone, in the pre-Internet '80s). After that, the narrative's pace never relents from depictions of Cramer's early days at Goldman Sachs through the launch of his own fund, which led to magazine columns, a near-constant presence on TV, and TheStreet.com. Cramer's description of the financial news Web site's launch is ruthless, not just toward the executives whose scheming and mismanagement, he says, undermined TheStreet.com's success, but toward himself for hiring them and temporarily destroying his long-standing friendship with publishing fixture Marty Peretz. Cramer is equally self-recriminating about the effect his fanatical trading had on his personal life, but clearly still loves to linger over every major deal of his career (and a lot of the minor ones), even perhaps especially if they blew up in his face. This is a lively, informative portrait of the highest levels of finance and media in the last decade.



39. The Neatest Little Guide to Stock Market Investing
The essential stock market guide updated with timely strategies for investing after the crash. Now in its fourth edition, Jason Kelly's The Neatest Little Guide to Stock Market Investing has established itself as a clear, concise, and highly effective guide for investing in stocks. This comprehensively updated edition contains tried-and-true investment principles to teach investors how to create and refine a profitable investment program. New strategies and content include:
•Basic tips on when to invest and how to reduce the amount of risk in this turbulent market
•A new core portfolio technique that shows readers a way to achieve 3 percent quarterly performance with the IJR exchange-traded fund
•An exclusive interview with legendary Legg Mason investment counselor, Bill Miller, including his thoughts on the financial crash of 2008.
Accessible and intelligent, The Neatest Little Guide to Stock Market Investing is what every investor needs to keep pace in the current market.



40. The Dick Davis Dividend: Straight Talk on Making Money from 40 Years on Wall Street
A pioneer in the financial media, Dick Davis has interacted with the investing public for over forty years. With his new book, he continues this trend. The first part of The Dick Davis Dividend contains an easy-to-read, yet profound discussion of the essentials of investing—focusing on the savvy veteran’s often unconventional, core beliefs. While the second part of this engaging guide makes a compelling case for combining both passive investing via index funds and active investing via stocks and mutual funds.






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