When the legendary super investor, Warren Buffett was asked about the secret of his success, he reached for a thick stack of papers and replied:
“Read 500 pages like this every day, and your knowledge will build up like compound interest.”
Warren claims he spends the bulk of his working days, about 80%, just reading and thinking. In this way, Buffett learns and evaluates new investment opportunities, while waiting patiently for his perfect pitch.
Many have asked Warren what books he recommends, and below, you’ll find ten books that Warren has personally suggested either to live audiences or via his famously popular annual shareholders letters.
The first two books, were both written by Warren’s mentor: Benjamin Graham. The Intelligent Investor and Security Analysis guided Buffett’s career as a “value investor”, and changed the way Buffett viewed the stock market.
1.) The Intelligent Investor
In "The Intelligent Investor," Benjamin Graham lays out a timeless philosophy for value investing, emphasizing a long-term, disciplined approach over short-term speculation. He advises investors to cultivate a "Mr. Market" mentality, viewing market fluctuations as opportunities to buy undervalued stocks below their intrinsic worth.
2.) Security Analysis
Security Analysis, written by Benjamin Graham and David Dodd in 1934, is considered one of the most important books ever written on investing. It introduced the concept of value investing, which involves purchasing stocks that are trading below their intrinsic value. This approach has helped countless investors generate significant long-term returns.
3.) Personal History
Katharine Graham (friend of Buffett) who oversaw the Washington Post during the Watergate scandal, offers a candid and introspective memoir. She shares her personal journey and the historical backdrop against which it unfolded, weaving together tales of family dynamics, navigating a changing world as a woman, and the choices she made leading the Post.
4.) Business Adventures
Twelve Classic Tales from the World of Wall Street" by John Brooks isn't your typical dry business book. It's a collection of twelve engaging stories that originally appeared in The New Yorker, offering a glimpse into the fascinating and often dramatic world of finance.
5.) The Outsiders
"The Outsiders" offers a fascinating and valuable counterpoint to conventional business and investment philosophies. By showcasing the success of CEOs who prioritized long-term value creation and disciplined capital allocation, the book provides valuable insights for anyone seeking to achieve sustainable success in their own endeavors.
6.) The Clash of the Cultures
Investment giant John Bogle lays bare his concerns about the financial industry's shift towards short-term speculation. He argues that this focus on immediate gains has strayed from the core principles of long-term investment, ultimately harming both individual investors and the overall market.
7.) Little Book of Common Sense Investing
Bogle, founder of The Vanguard Group and a champion of index funds, argues that consistent, low-cost investing in broad market indexes is the key to long-term success for most individuals. He emphasizes the importance of understanding costs, managing expectations, and avoiding emotional decisions often fueled by market hype.
8.) Common Stocks and Uncommon Profits
Learn to prioritize growth, conduct in-depth company analysis, and build a "margin of safety" for your investments. Fisher's core philosophy of buying below intrinsic value and holding for the long haul remains relevant. Ideal for value investors seeking historical context and practical insights.
9.) Where Are the Customers’ Yachts?
The title itself comes from a story where a visitor, upon seeing the luxurious yachts of bankers and brokers, asks about the customers' yachts. Schwed shares the contradictions and potential pitfalls of the investment industry, offering valuable contrarian advice and encouraging investors to take a more skeptical and informed approach to managing their finances.
10.) Investing Between the Lines
The book equips you with a methodology for decoding CEO communications, enabling you to see beyond the jargon and platitudes often used in annual reports, shareholder letters, and earnings calls. By learning to discern the true meaning behind the words, you'll gain the ability to evaluate a company's financial health and future prospects with greater confidence.
We hope you’ve enjoyed our list of Warren Buffett’s book recommendations! Whether you're aiming to conquer the market or simply seeking wisdom for life's journey, cracking open a book from Buffett's trusted shelf is sure to offer valuable insights.
So, bookmark this list, grab your favorite reading companion, and get ready to embark on a learning adventure guided by the "Oracle of Omaha" himself.
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