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 Post subject: Recommended Investment book
PostPosted: Thu Aug 09, 2012 12:45 pm 

Joined: Wed May 05, 2010 3:06 pm
Posts: 9
Good afternoon,
I am looking for some recommendations on an investment book. I have never really done any investing before and would like to learn about it some more. So if you could please refer me to a previous discussion or make a recommendation. I greatly appreciate it.

Thank you


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 Post subject: Re: Recommended Investment book
PostPosted: Thu Aug 09, 2012 1:08 pm 

Joined: Fri May 04, 2007 8:14 pm
Posts: 1757
Lots of good books out there, but http://www.amazon.com/The-Elements-Investing-Burton-Malkiel/dp/0470528494/ by Malkiel and Ellis is an excellent start and contain all you need to know for a very long time.


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 Post subject: Re: Recommended Investment book
PostPosted: Thu Aug 09, 2012 1:48 pm 

Joined: Wed May 05, 2010 3:06 pm
Posts: 9
VinTek wrote:
Lots of good books out there, but http://www.amazon.com/The-Elements-Investing-Burton-Malkiel/dp/0470528494/ by Malkiel and Ellis is an excellent start and contain all you need to know for a very long time.


Thanks Vin Tek,
I have some money coming to me last this fall and I am trying to figure out what to do with it. It is going to roughly be about $10K. I already got a 401K through work, and Roth IRA on the side. I got my emergency money socked away and my credit card balance is around 2K.

Since this is extra money I want take some of it and maybe play the stock market game, so that is something I want to learn about, but I also want to put some of it away and collect some stable interest on it, but be available if needed.

Hope that makes sense.


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 Post subject: Re: Recommended Investment book
PostPosted: Thu Aug 09, 2012 2:00 pm 

Joined: Fri May 04, 2007 8:14 pm
Posts: 1757
Yes, it makes sense in that you are getting some extra money and you want to make it grow. However, stock-picking is pretty much a crap shoot, whether you're using technical analysis or fundamental analysis. It's pretty hard to get around the risk/reward relationship. Assuming you're maxed out in both your 401(k) and Roth IRA, I assume you'll be making your investments outside of tax-sheltered accounts.

In that case, your asset allocation and how it's divided into taxable and non-taxable accounts comes into play. Before you buy the book I recommended, read http://transparentinvesting.com/uploads/wholestory.pdf first. It's free and it will give you a good overview.


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 Post subject: Re: Recommended Investment book
PostPosted: Thu Aug 09, 2012 6:17 pm 

Joined: Mon Nov 01, 2010 5:15 pm
Posts: 1120
jlarz20 wrote:
Good afternoon,
I am looking for some recommendations on an investment book. I have never really done any investing before and would like to learn about it some more. So if you could please refer me to a previous discussion or make a recommendation. I greatly appreciate it.

Thank you

The Intelligent Investor by Ben Graham


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 Post subject: Re: Recommended Investment book
PostPosted: Fri Aug 10, 2012 6:37 am 

Joined: Fri Aug 10, 2012 6:11 am
Posts: 4
For me, 'Millionaire Teacher' by Andrew Hallam is a good read to earning an honest living, yet being able to becoming a millionaire.

_________________
I am a financial advisor giving free financial advice on my website. You can visit my site at http://www.passiveinvestingplan.com


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 Post subject: Re: Recommended Investment book
PostPosted: Fri Aug 10, 2012 1:39 pm 

Joined: Mon Jan 02, 2012 3:21 pm
Posts: 89
I would encourage you to do lots of learning before you try to "play the stock market game".

As a senior in college some of my engineering buddies and I spent months backtesting various trading strategies, convinced we were going to make millions in the long run. On paper and in our software it all worked flawlessly. Thankfully when we actually implemented the trading program I only used about 10% of my assets, because within months I had lost a large portion of what I started with. I learned very quickly that thinking you can do something on paper and actually executing it are very different things. Even if I made money for a while, I should have done my homework and learned that day trading and swing trading are ludicrous ideas...

You can't win if you try to "play the game", but if you learn about indexing and stay the course over the coming decades it should serve you well. There are no shortcuts, and the tortoise wins the race :)


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 Post subject: Re: Recommended Investment book
PostPosted: Fri Aug 10, 2012 1:58 pm 

Joined: Fri May 04, 2007 8:14 pm
Posts: 1757
Tightwad wrote:
The Intelligent Investor by Ben Graham

I greatly admire Graham but he did his own value investing in an age when information wasn't so readily available. EMH states that an efficient market is such because it accounts for information as soon as it becomes publicly available. The constant flow of new information creates the volatility we see in the market today, i.e. the "random walk." Also note that Graham himself said the following:
Quote:
In general, no. I am no longer an advocate of elaborate techniques of security analysis in order to find superior value opportunities. This was a rewarding activity, say, 40 years ago, when our textbook "Graham and Dodd" was first published; but the situation has changed a great deal since then. In the old days any well-trained security analyst could do a good professional job of selecting undervalued issues through detailed studies; but in the light of the enormous amount of research now being carried on, I doubt whether in most cases such extensive efforts will generate sufficiently superior selections to justify their cost. To that very limited extent I'm on the side of the "efficient market" school of thought now generally accepted by the professors.

You can read the entire interview http://www.bylo.org/bgraham76.html. Tightwad's recommendation is great reading written by a great investor but I don't believe that it's good book to use as a foundation for investing today due to the wide availability of information.


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