“In my whole life, I have known no wise people who didn’t read all the time – none … ZERO.”
Charlie Munger
When I was much younger, I used to recall myself winning a set of encyclopedia as part of Singapore’s iconic Bookworm club. It gave me the understanding of The Milky Way and exposure to several scientific terms beyond the then school syllabus. Later on, my interest died down and I avoided books at all costs…. not until I encountered this book called Your Erroneous Zones. To put things in context, in secondary school, I wasn’t motivated and I rather let events dictate the direction of my life. I did not understand my own mind too.
After that book, I reflected and I could say that the reason why I changed so much was because of the content in the book. Since then, I understood the positive impact and compounding power of knowledge in my life. I have invested a lot of money during my army days and up to now, in pursuing quality investment books. In fact, there are many out books out there, what is good and what is bad? I relied on peer reviews and Amazon reviews. If you wish to find out about the books that I am interested, visit this link. It will be updated as I discover impactful books that will value-add to your life.
This section is my way of giving back to share with you how I managed to compound my money consistently through applying the content in the list below. Just to mention, I have personally read the books I mentioned over here. The books will be categorised carefully, and I will add in new books once in a while. Or you can check out my Amazon book recommendation by using this link. Or Boryhill’s Library.
Economics
How an Economy Grows and Why It Crashes
by Peter D. Schiff and Andrew J. Schiff- this book would serve an excellent economics introductory for beginners. I thoroughly enjoyed how the authors were able to simplify complex concepts through characters from a fishing village. It has good humour as well. Enjoyed it in a reading.
Business Model and Strategy
Hidden Champions of the Twenty-First Century: The Success Strategies of Unknown World Market Leaders
by Hermann Simon. I am utterly amazed by the rich content produced by the highly respected Hermann Simon with regards on how business, even when they are small and young, are able to command an extremely high market share in the markets that they serve. It blows my mind that the author was able to link culture to outperformance and it entirely transformed the way how I look at businesses. This is simply gold that our schools don’t teach.
Confessions of the Pricing Man: How Price Affects Everything
by Hermann Simon. A lot of us do not understand the importance of pricing power and its ability to allow a company to produce supernormal profits. In fact, we underestimated it. This book is practical, fun to read, mindblowing and sharp on many fronts. This is another solid gem from Hermann Simon that MUST not be MISSED.
Business Models: Investing in companies and sectors with strong competitive advantage by David Watson. Every business has a business model. But not all business model are made equal. A business with recurring income should always be valued higher because earnings are smooth and it provides certainty. As an investor with limited time, this book equipped me with the knowledge to decide whether a company is worth investing — intuitively based on their business model. A very good book.
Portfolio Management
The Art of Execution
by Lee Freeman-Shor. This book is simple yet it left a profound impact on me. Most people neglect the fact that execution is also 50% of the key for a profitable trade. The art of execution goes into sizing up your bets, reducing your bets, or getting totally out of it. Every dollar invested has an opportunity cost to it ,are you maximising it?
The Winning Investment Habits of Warren Buffett & George Soros
by Mark Tier. Chapter 7 entitled “You Call That a Position?” left a deep impact on my portfolio bets and size. George Soros famously told that line to Stanley Druckenmiller. This highly recommended book taught me to size up my bets if I feel confident about my bets and buy enough so that it makes a real difference to my wealth. I simply buy as much as I can when I see a really good stock.
Value Investing
The Five Rules for Successful Stock Investing by Pat Dorsey. I have picked up what are the key characteristics of different industries. Through Pat’s unique insights, he detailed what are the unique challenges each industry faces and how can an investor spot the hallmarks of a well-managed company in its respective industry. A reader will thrive on his wealth of knowledge.
One Up On Wall Street: How To Use What You Already Know To Make Money In The Market by Peter Lynch. This is the first investment book I read. It demonstrated very convincingly that an ordinary investor is able to find ample opportunities all around you. This is also one of the key reasons I would ask myself “is this company listed?” whether I come across a good product. It also provided an excellent introductory to 6 types of companies that he coined.
Beating the Street by Peter Lynch. Another classic, must-read for any new investor. “What skills do we have that allows us to beat professional fund managers?”, I asked myself, 4 years ago. This book instilled me with the confidence that I may be new but it does not mean that I cannot make good returns. After this book, I am certain that even as a new investor, I have ample opportunities if I operate within my circle of competence.
The Warren Buffett Way by Robert G. Hagstrom. This author was able to articulate Buffett’s philosophy using very simple language and I’ve benefited from it.
100 Baggers: Stocks That Return 100-to-1 and How To Find Them
by Christopher W. Mayer. When we invest in a company, are we satisfied with just merely 10 – 20% returns? Yes, we may. But isn’t a 100 bagger more exciting? This book taught me to find out the time-tested key characteristics or rather “DNA” of small-medium companies who could turn out to be multi-baggers for your portfolio.
Investing Between the Lines: How to Make Smarter Decisions By Decoding CEO Communications by L.J. Rittenhouse. In shareholders’ communications, this book made it clear to me how a CEO could use his annual report statements or commentaries to inform or deceive the general public about the fundamentals of the company he is running. Some CEOs tend to take the shortcut by hiring public relations firm to do up their communications. This book pierces through the communications and equips you with skills to read between the lines.
The Financial Times Guide to Value Investing: How to Become a Disciplined Investor by Professor Glen Arnold. As an excellent introduction to Warren Buffett, Charlie Munger, Ben Graham, Peter Lynch and John Neff, an investor can glimpse on his summarised yet high-quality content on the different value investing strategised utilised by the mentioned investors.
Market Wizards, Updated: Interviews With Top Traders by Jack D. Schwager. I particularly enjoyed the chapters of William O’Neil and Larry Hite. In a way, to accelerate my own learning curves and minimise my mistakes, I seek to learn the experiences of traders and investors. This book dives into the psychology and decision-making process which is as important as temperament. Jack did an amazing job to weave those stories into a book.
Super Stocks by Kenneth Fisher, son of Philip A. Fisher. I thoroughly enjoyed this book. I was given the knowledge of how I am able to apply Price-to-Sales ratio in order to identify stocks who are out of the favour. It happens when a company experienced a setback or a “glitch” where its margins are squeezed or it is experiencing a temporary setback. One of the greatest rewards is to invest in turnarounds and this book gives an good indication on how you can spot one.
The Most Important Thing Illuminated: Uncommon Sense for the Thoughtful Investorby respected Howard Marks. Mark touched on the concept of “second-level thinking” and it transformed the way I look at my companies. If an investor is thinking on the same level as me, then where is my competitive edge? How am I able to reach a second-level of thinking process? What do I know that others don’t know? Or what do others know that I don’t? Read more to find out.
Poor Charlie’s Almanack: The Wit and Wisdom of Charles T. Munger edited by Peter D. Kaufman. This book is highly acclaimed and it is worth a lot more than the price you will pay for it. This goes into the entirety of Charlie Munger’s philosophy. It goes deep into ‘lollapalooza’ where one’s knowledge in various field of expertise mesh together to create a wonderful effect.
Common Stocks and Uncommon Profits and Other Writings by Philip A. Fisher. This book touches on the concepts of scuttlebutt and a 15-point filtering system. This book trained me to have an inquisitive mind and a great line of questioning for the management. This is highly recommended because management is the cause while the financial results are the results. Many investors tend to neglect the management aspect.
The Investment Checklist: The Art of In-Depth Research by Michael Shearn. This is a good book that every new investors should endeavour to read. After reading this, my criteria for stocks became much clearer and win-lose ratio narrowed. Investment is a process, and the process will produce your fruits of capital gains. Focus on the process.
Others
- A collection of Peter Lynch Articles from the 90s
- The Psychology of Money
- The Sleutch Investor
- Richer, Wiser, Happier by William Green
- Thinking Fast and Slow
- Quality Investing – Owning the Best Companies
- Nothing But Net
- Zero to One by Peter Thiel
- Mastering the Market Cycle
- The Little Book of Valuation by Aswarth Damodaran
- Non-Consensus Investing: Being Right When Everyone Else is Wrong
- Expectations Investing by Michael Maboussin
