As you’re learning how to invest, one of the best strategies for advancing quickly is to learn from the masters. Rather than repeating the same old mistakes of new investors, it’s useful — and it saves money — to gain the insight and wisdom of the experts. For the cost of a book, you could save thousands of dollars by making smart investing decisions and avoiding dumb ones.
Below are some of the best investing books. Some are deep dives that have stood the test of time and continue to reward new readers with the wisdom of investing masters. Some are lighter reads that tell more recent stories from other voices and offer different perspectives.
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Deep dives: Investing books that zoom in
1. “The Intelligent Investor: The Definitive Book on Value Investing”
“The Intelligent Investor” by Benjamin Graham is like a shorter, more readable version of Graham’s other famous book, “Security Analysis” (co-authored with David Dodd). Graham is considered the father of value investing, an investing style where practitioners are looking to buy $1 for $0.75 or less, and he was a key mentor for legendary investor Warren Buffett, who contributed to a later edition. Here Graham shows you how to think sensibly about investing and how to avoid the mistakes of so many inexperienced investors.
First published in 1949, “The Intelligent Investor” has many versions from decades past, but recent editions with editor Jason Zweig offer modern commentary that provides perspective on more contemporary events.
Amazon rating: 4.7 stars
Notable quote: “To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks.”
2. “You Can Be a Stock Market Genius: Uncover the Secret Hiding Places of Stock Market Profits”
“You Can Be a Stock Market Genius” by Joel Greenblatt is a modern classic, and it showcases how to find stocks that are hidden by superficial events, such as spin-offs. First published in 1997, it’s become a relatively quick favorite of current investors due to its easy-to-read style, practical examples and humor. Yes, humor! In his inimitable prose, Greenblatt gives you all the details on how to uncover these hidden gems.
For example, using the book’s approach, readers would have been able to track PayPal, before it spun off from parent eBay in 2015, and then proceeded to return 400 percent to investors over the next five years.
Amazon rating: 4.5 stars
Notable quote: “Even after you learn where to look for new ideas, the notion that you can cover even one-tenth of these special corporate events is a pipe dream.”
3. “Common Stocks and Uncommon Profits and Other Writings”
This classic investing book is another focused on practical examples that show readers how to find attractive stocks that could earn them seriously huge returns. Author Philip Fisher is a giant in the investing world, and he reveals many of his secrets in this book, including the qualities to look for in an attractive business.
First published in 1958, “Common Stocks and Uncommon Profits” still offers so much wisdom that contemporary readers continue to cite Fisher’s work today. One of Fisher’s classic techniques is called the scuttlebutt method, in which he advises investors to see what a company’s rivals say about it, in order to assess the company’s competitive position.
Also worth noting, Warren Buffett says that his own investing approach is a combination of Benjamin Graham’s and Fisher’s — it’s hard to receive higher praise than that!
Amazon rating: 4.6 stars
Notable quote: “Even in those earlier times, finding the really outstanding companies and staying with them through all the fluctuations of a gyrating market proved far more profitable to far more people than did the more colorful practice of trying to buy them cheap and sell them dear.”
4. “Beating the Street”
“Beating the Street” is another gem, and it showcases in plain English — and with a no-nonsense style — how to pick winning stocks. It’s written by Peter Lynch, the longtime fund manager for Fidelity’s Magellan fund, and one of the most highly regarded investors on the planet. Lynch runs you through some of his own investments at the fund, and shows you where he succeeded and even where he failed, with a kind of ego-less good humor that feels rare on Wall Street.
Originally published in 1992, this book follows up on Lynch’s bestseller “One Up on Wall Street,” and shows you how to use your experience in daily life to find winning stocks. For example, if you see friends start to buy a new product, its producer could be an attractive stock purchase, and this approach has been called the Lynch method for finding stocks.
Amazon rating: 4.6 stars
Notable quote: “My diaries are full of such missed opportunities, but the stock market is merciful — it always gives the nincompoop a second chance.”
5. “Margin of Safety: Risk-Averse Value Investing Strategies for the Thoughtful Investor”
“Margin of Safety” by Seth Klarman is something of a legend in the world of investing books. Klarman, now a billionaire, published the book in 1991, and it’s remained a holy grail since then. That’s because the book is scarce — it’s never been reprinted, and sellers regularly ask more than $1,000 a copy. The book details Klarman’s conservative, value-based approach to investing, using the principle of margin of safety. That is, he advises you to buy an asset at such a sufficiently low price relative to its probable worth that it would be hard to lose money.
Amazon rating: 4.4 stars
Notable quote: “Successful investors tend to be unemotional, allowing the greed and fear of others to play into their hands.”
6. “Investing in REITs”
If you’re interested in investing in real estate in the public stock market, then you’ll want to read Ralph Block’s “Investing in REITs”. REITs are real estate investment trusts, and they’re among the most popular kinds of stocks because of their typically large dividends and attractive long-term record of returns. This book is quite popular among REIT investors and those learning the field, and it’s already on its fourth edition, after first being published in 1998. Block distills his decades of investing in REITs into the key qualities you need to look for in the sector.
Amazon rating: 4.4 stars
Notable quote: “REITs give you the steady and predictable cash flow that comes from owning and leasing real estate, but with the benefit of a common stock’s liquidity.”
Lighter reads: Investing books that zoom out
1. “The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Success”
“The Outsiders” is a fantastic read, even if you’re only somewhat interested in investing. That’s because author William Thorndike narrates the stories of eight unconventional CEOs — Katharine Graham of The Washington Post, Warren Buffett of Berkshire Hathaway and Bill Anders of General Dynamics to name a few — who go against the grain and create outstanding returns for their shareholders. It’s all about how rational decision-making, despite conventional wisdom, leads to excellent outcomes. While not solely about investing, “The Outsiders” may be the most engaging for readers of all kinds because of its style. It also may be the best book to start with if you’re first learning about investing.
Amazon rating: 4.6 stars
Notable quote: “When their stock was cheap, they bought it (often in large quantities), and when it was expensive, they used it to buy other companies or to raise inexpensive capital to fund future growth.”
2. “Get Good With Money: 10 Simple Steps to Becoming Financially Whole”
Former preschool teacher Tiffany Aliche was cruising along financially and had even built a nest egg — until bad investing advice and a recession wiped out her savings and left her in debt. Aliche turned her finances around and began sharing what she had learned as a financial educator.
In the bestselling “Get Good With Money,” Aliche outlines how she set herself up for future success through comprehensive financial planning and building wealth. Aliche also highlights the supporting characters in investing. That is, all the things that can make investing more feasible and allow you to put more money into the market, such as budgeting, raising your credit score and paying off debt.
If you’re looking for a 10,000-foot view with a good dose of investing, this book may be for you.
Amazon rating: 4.8 stars
Notable quote: “Financial wholeness doesn’t stabilize just one aspect of your financial life but all aspects of your financial life.”
3. “The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns”
In “The Little Book of Common Sense Investing,” mutual fund trailblazer and Vanguard founder John Bogle makes the case for why index funds are the simplest, most effective way to build wealth. First published in 2007, Bogle uses real-world examples to discuss returns and investor sentiment over time and builds the argument for investing in index funds, which offer instant diversification with low costs. Bogle updated the book in 2017 to include new chapters on retirement investing and asset allocation.
Amazon rating: 4.7 stars
Notable quote: “Index funds make up for their lack of short-term excitement by their truly exciting long-term productivity. The TIF (traditional index fund) is designed to be held for a lifetime.”
4. “The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness”
Award-winning author Morgan Housel lays out 19 short stories in “The Psychology of Money” that delve into how people think about money and how their thinking impacts their wealth. Housel explores how investing and personal finance decisions are often guided by more than just math — and how a patient investor with no professional training can out-invest a finance professional. If you have a good grip on foundational investing concepts or want to explore the behavioral side of investing, this book is a solid choice.
Amazon rating: 4.7 stars
Notable quote: “The fascinating thing about these stories is how unique they are to finance. In what other industry does someone with no college degree, no training, no background, no formal experience, and no connections massively outperform someone with the best education, the best training, and the best connections? I struggle to think of any.”
5. “The Simple Path to Wealth: Your Road Map to Financial Independence and a Rich, Free Life”
Compiled from letters written to his daughter, author JL Collins shares his investing experiences and advice in his bestselling book “The Simple Path to Wealth.” In the book, Collins — who has been called the godfather of the financial independence movement — explains how the stock market works, analyzes traditional investing advice, offers his take on investing and details the mechanics of investing. A revised edition comes out this spring.
Amazon rating: 4.7 stars
Notable quote: “Stop thinking about what your money can buy. Start thinking about what your money can earn.”
6. “The Little Book that Still Beats the Stock Market”
“The Little Book that Still Beats the Stock Market,” which is also by Joel Greenblatt, explains how investors can outperform market averages by applying a formula that seeks out solid businesses when their stocks are being sold at bargains. But don’t let the jargon intimidate you. Greenblatt first explores basic market principles and then reveals the formula for value investing using middle-school math and plain language. This book is a great option for those looking to take their investing skills to the next level or those who want a shorter take on value investing.
Amazon rating: 4.5 stars
Notable quote: “Choosing individual stocks without any idea of what you’re looking for is like running through a dynamite factory with a burning match. You may live, but you’re still an idiot.”
Bottom line
Reading about investing is one of the highest-return activities you can do. Not only can you learn about how to approach investing smartly from some of the world’s best investors, you can avoid some of the pitfalls that can sink you early on in your journey. As Warren Buffett famously said, “Rule No. 1 is never lose money. Rule No. 2 is never forget Rule No. 1.”
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