Financial Book Picks

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In the last few years I’ve read quite a few books that are related to finance. Here are my favorites broken down by sub-genre.

Basic Investing

Bull's Eye Investing: Targeting Real Returns in a Smoke and Mirrors Market
Bull’s Eye Investing: Targeting Real Returns in a Smoke and Mirrors Market by John F. Mauldin is my pick for the average person who¬†wants to invest in the stock market. John Mauldin makes heavy use of charts and the work of Ed Easterling and lays out probable returns based off of certain conditions. If you are rightfully skeptical when you are told the big lie that stocks always go up in the long term, this is the book for you.

Financial History

Origins of the Crash: The Great Bubble and Its Undoing
Origins of the Crash: The Great Bubble and Its Undoing by Roger Lowenstein is my pick for the best financial history book. Roger is the best financial historian there is and is probably better known for his book When Genius Failed: The Rise and Fall of Long-Term Capital Management. I loved both books, but think Origins of the Crash is a more interesting time period that more people will relate to than the 1998 LTCM crisis.

Philosophy

Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets
Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets by Nassim Nicholas Taleb explores how humans undervalue unexpected events. I loved this book when I reviewed it back in March and plan to read it again some day. The chapter on the Black Swan was later expanded into a full book. Read Fooled by Randomness first, then tackle the Black Swan.

Trading Psychology

Reminiscences of a Stock Operator (Wiley Investment Classics)
Reminiscences of a Stock Operator (Wiley Investment Classics) by Edwin Lefvre the story of legendary trader Jesse Livermore and was written back in 1922. If you think you want to be an active investor, I highly recommend reading this book. This is a book that traders on Wall Street will read multiple times throughout their career.

A Little Bit of Everything

More Than You Know: Finding Financial Wisdom in Unconventional Places (Updated and Expanded) (Columbia Business School Publishing)
More Than You Know: Finding Financial Wisdom in Unconventional Places (Updated and Expanded) (Columbia Business School Publishing) by Michael J. Mauboussin is a great mix of philosophy, psychology and statistics easily explained across 30 essays. If your reading time is limited and you want to expose yourself to a little of each of these topics, then this is the book you want.

What finance books would you add to the list?

3 thoughts on “Financial Book Picks

  1. Stuart

    Reminiscences of a Stock Operator is a great book. However, I have to disagree on the Fooled by Randomness book. I felt it was uneven and can’t recommend it to others.

  2. Fooled By Randomness is bigger and broader than finance. It is about reconciling cause and effect with limitations in human biology. It was not a fast read, but it forever changed the way I see life.

  3. Matt

    I’m a fan of these books (more about biz building which is the best way to ‘invest’ in my opinion) …

    – Built to Last
    – Good to Great
    – Rich Dad’s Guide to Investing
    – The Answer

    There are many others, but they don’t come to mind off the top of my head and if you read these, you’d have enough to get started, which is all you need to do … get started, TAKE ACTION!, make mistakes (fail fast), learn, apply what you learned, repeat

    Matt

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