Please see the link below, I have mentioned a series book with justification. But you will get plenty of book references all over forum.
This is what I normally tell my nears and dears who wants to test the water.
Stage 1: to familirise
Book 1: Why are we so clueless to stock market? By Mariusz Skonieczny
This book uses very simple words to tell you what is a business and stock,
basics of valuation, capital structure, economy, IPO , diversification etc.
Classic primer book.
Book 2: F wall street by Joe Ponzio
Logical forwarding from previous book, talks about business in detail,
prolonged analysis of valuation etc.
Book 3: The little book that creates wealth by Pat Dorsey
A short and sweet version to know why a company can be superior to others?
Book 4: Five successful rules of investing by Pat Dorsey
This will bring you to practice notes, time to put your work into practice
and find out the shortcomings. It’s user manual short of book covering all
major aspects of investments.
Book 5: Common stock and uncommon profits by Phil Fisher
Before moving to stage 2 it takes out from hangover of value based analysis
learnt from 4 previous books and bring a new dimension to growth and
expansion. Stepping stone before stage 2.
All books are written in simple words, short books and pure practical books.
Stage 2 of my list would be: this stage is to start working on investments and refining execution skills as we move forward.
Book 6: The Investment Checklist by Michael Shearn
As the name says it’s a checklist, what better way to do an investment documentation than starting with a checklist. You get question by question , topic by topic guidance.
Book 7: Financial Statements step by step guide by Thomas Ittelson
Introduces value investing, tells you basic accounting and financial analysis. Some of the terms used by Michael Shearn will look easier through this book.
Book 8: Active Value investing by Vitaly
What is sideways market? How can value investing kills boring side ways market with quality , growth and valuation. The author introduces absolute PE model.
Book 9: You can be a stock market genius by Joel Greenblatt
Time to hunt places which are not easily visible, book dedicated to “special situations”.
Book 10: The art of short selling by Kathryn
Best way to build an bear case (what can go wrong with thesis) is having a bear mind or short seller mind. Tells you all those spots which makes you sit upright for stage 3.
Stage 3: this is the optimisation stage which includes maintain and enhance capabilities:
Book 11: What I learned loosing Million dollar by Jim Paul
Foundation for behavioural finance. First time one realise investing is 83% psychology after reading all these books. Nerve chilling story of Jim Paul’s bankruptcy and equally successful comeback with why, and what.
Book 12: Value Investing and beyond by Bruce Greenwald
Arguable an attempt by a professor to bridge business strategy with stock valuation. This book connects well with Porter five force and you will start realise DCF valuation can be hollow many times as well.
Book 13: Quality of earnings by Thornton Glove
Welcome to world of deception, how numbers doesn’t tell you all?
Book 14: Financial Schenanigans by Howard
Next stage of deception…all about manipulation and fakery.
Book 15: The most important thing by Howard Marks
I sign off with this book as it reminds the journey of 14 books as summary.
Few compendiums and special topics I would add after all stages but not during practicing hours.
- The Art of Value Investing: quotation board or dictionary of value investing
- It’s earning that count: special topic book to short list superior valuation companies
- The Manual of Ideas: as the name says ideas and ideas
- Creative cash flow reporting: attack on cash flow fakery , very important as investors rely cash flow statement to detect fakery within Profit/Loss and Balance sheet.
- Finally Berkshire’s letter- one can’t miss this. No need to write about this one. If someone had seen this year Berkshire AGM live they know what I am talking about. The impeccable energy and truthfulness is what is reflected in these letters.
Of course lots more to read, let us start somewhere immediately.