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2,042 reviews
John Garling
Excellent but Completely Outdated
18 August 2018 -
Published on Amazon.comVerified Purchase
Sherelle Montague
Definitely not a beginners book!
29 December 2017 -
Published on Amazon.comVerified Purchase
Alex
Buy stocks as groceries, not as jewelry.
22 June 2016 -
Published on Amazon.comVerified Purchase
Buy stocks as groceries, not as jewelry.
Reviewed in the United States on 22 June 2016
Edition: I found commentary very useful (though often distracting). If you are not a professional - you'll appreciate the commentaries and epilogue - read it first? It's very inspiring.Reviewed in the United States on 22 June 2016
Book: "You either get the idea in the first five minutes, or you don't get it at all", commented Warren Buffet in the epilogue. I would add - you don't necessarily need to read all 550 pages, but you must read through the idea of value investing - and it will change your way of looking at the world. I always felt confused and amazed by listening to all the ridiculous fuzz that comes from the Wall Street through TV and the internet. The book explains why.
Several rules of thumbs I noted into my keep:
- Investor buys the business [based on its price/value], speculator buys the stock [based on an absurd believe that he can foresee where the stock price will go].
- The best way to earn adequate return without any trouble whatsoever is to invest into cheap (low maintenance cost) indexes; use dollar averaging (buy every month instead of once at a random point of time) for smoothing the luck involved.
- For enterprising investor (willing to spend much more time), look for a diversified list of bargain issues (at least 30 issues, business values (i.e. net current asset and other related metrics) is below market cap)
- During the bubble, hot industries and companies are getting overpriced. That could only be financed from somewhere. Partially that money are coming from well established old economy companies that lose the appeal. Thus, invest in such old economy companies while bubble grows, as soon as the bubble burst - undervalued companies would rise back.
- Don't ever buy IPOs! (See chapter for compelling arguments)
- Don't consider companies that do not pay dividends. Dividends - money firm pays you for providing capital, they belong to you. They cut a piece for reinvestment - payout ratio. If firm doesn't pay dividends - invest all into growth so you could profit later - that's a speculation. Moreover stock price would be more volatile because it should now rely on future rather than current prospects.
- When gambling - bet on a single chip to maximize the payoff (roulette $1 to $35 payoff at 1/37 chance). When investing - diversify: each investment must have a margin of safety, the more diversified portfolio - the less likely that all will fail. You are a roulette house now who earns with each turn of the wheel.
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Tarek
10/10 Great Book, Do Yourself the Favor of Buying the Paperback
2 May 2017 -
Published on Amazon.comVerified Purchase
Peggy
Best book I've found on value investing!
27 March 2019 -
Published on Amazon.comVerified Purchase
Best book I've found on value investing!
Reviewed in the United States on 27 March 2019
This is an excellent book for all investors - new ones and veteran ones! This book gives lots of valuable information to help one understand the basics of value investing. I have purchased several books on investing, and (as you can see by the number of post-its in this book), this is the most valuable resource I have found so far. I highly recommend this book! Please mark if you find my review helpful. Thank you so much!
Reviewed in the United States on 27 March 2019
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