Warren Buffett is a business magnate and philanthropist, who is considered as one of the most successful investors in the world.
Buffett has been the chairman and largest shareholder of Berkshire Hathaway since 1970 and his business exploits have had him referred to as the “Wizard”, “Oracle” or “Sage” of Omaha by global media outlets. He is noted for his adherence to value investing and for his personal frugality despite his immense wealth
These are some of the books recommended by Warren Buffett:
1. Business Adventures
Subtitle: Twelve Classic Tales From the World of Wall Street
Summary: Longtime New Yorker contributor John Brooks’s insightful reportage is so full of personality and critical detail that whether he is looking at the astounding market crash of 1962, the collapse of a well-known brokerage firm, or the bold attempt by American bankers to save the British pound, one gets the sense that history repeats itself. Five additional stories on equally fascinating subjects round out this wonderful collection that will both entertain and inform readers. Business Adventures is truly financial journalism at its liveliest and best.
Quote: “Apart from the economic advantages and disadvantages of stock exchanges — the advantage that they provide a free flow of capital to finance industrial expansion, for instance, and the disadvantage that they provide an all too convenient way for the unlucky, the imprudent, and the gullible to lose their money — their development has created a whole pattern of social behavior, complete with customs, language, and predictable responses to given events.”
2. Common Stocks and Uncommon Profits
Author: Philip A. Fisher
Summary: First published in 1958, Common Stocks and Uncommon Profits and Other Writings is regarded as a great resource by investors. Its chief author Philip Fisher is regarded amongst the most influential investors of all time. The updated version of this book also includes the perspectives of Ken Fisher, an investment guru and son of the original author. The opinions of Ken are presented in the form of an expanded preface and introduction.
Quote: “Most people, particularly if they feel sure there is no danger of their being quoted, like to talk about the field of work in which they are engaged and will talk rather freely about their competitors. Go to five companies in an industry, ask each of them intelligent questions about the points of strength and weakness of the other four, and nine times out of ten a surprisingly detailed and accurate picture of all five will emerge. However, competitors are only one and not necessarily the best source of informed opinion. It is equally astounding how much can be learned from both vendors and customers about the real nature of the people with whom they deal.”
3. Dream Big
Author: Cristiane Correa
Summary: In just 40 years a Brazilian trio built the biggest empire in the history of Brazilian capitalism and launched themselves onto the world stage in an unprecedented way. Their culture is as efficient as it is merciless and leaves no room for mediocre performance. On the other hand, those who bring in exceptional results have the chance to become company partners and make a fortune. Dream Big presents a detailed behind-the-scenes portrait of the meteoric rise of these three businessmen, from the founding of Banco Garantia in the 1970s to the present day.
Quote: “In less than two decades, they had transformed a regional brewer with a strong name and feeble results, Brahma, into the biggest company in the sector at a global level. All this had been achieved by repeating ad nausea the mantras of the corporate culture Lemann had adopted at the beginning and then spread to all the company in which they invested: meritocracy, relentless cost control, hard work, and a lot of pressure that not everyone could endure. There were no perks or status symbols. However, for the best — people like Brito, Thompson, and Dutra — the opportunities gave them the chance to become business partners.”
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4. The Little Book of Common Sense Investing
Subtitle: The Only Way to Guarantee Your Fair Share of Stock Market Return
Author: John Bogle
Summary: Filled with in–depth insights and practical advice, The Little Book of Common Sense Investing will show you how to incorporate this proven investment strategy into your portfolio. It will also change the very way you think about investing. Successful investing is not easy. (It requires discipline and patience.) But it is simple. For it s all about common sense.
Quote: “[There is] a profound conflict of interest between those who work in the investment business and those who invest in stocks and bonds. The way to wealth for those in the business is to persuade their clients, ‘Don’t just stand there. Do something.’ But the way to wealth for their clients in the aggregate is to follow the opposite maxim: ‘Don’t do something. Just stand there.’ For that is the only way to avoid playing the loser’s game of trying to beat the market.”
5. The Most Important Thing
Subtitle: Uncommon Sense for the Thoughtful Investor
Author: Howard Marks
Summary: The Most Important Thing explains the keys to successful investment and the pitfalls that can destroy capital or ruin a career. Utilizing passages from his memos to illustrate his ideas, Marks teaches by example, detailing the development of an investment philosophy that fully acknowledges the complexities of investing and the perils of the financial world. Marks expounds on such concepts as “second-level thinking,” the price/value relationship, patient opportunism, and defensive investing.
Quote: “Successful investing requires thoughtful attention to many separate aspects, all at the same time. Omit any one and the result is likely to be less than satisfactory.”
6. The Intelligent Investor
Author: Benjamin Graham
Summary: Written by one of the greatest investment advisers of twentieth century, the book aims at preventing potential investors from substantial errors and also teaches them strategies to achieve long-term investment goals. Over the years, investment market has been following teachings and strategies of Graham for growth and development.
Quote: “The art of investment has one characteristic that is not generally appreciated. A creditable, if unspectacular, result can be achieved by the lay investor with a minimum of effort and capability; but to improve this easily attainable standard requires much application and more than a trace of wisdom. If you merely try to bring just a little extra knowledge and cleverness to bear upon your investment program, instead of realizing a little better than normal results, you may well find that you have done worse.”
7. The Outsiders
Author: William Thorndike Jr.
Summary: In this refreshing, counterintuitive book, author Will Thorndike brings to bear the analytical wisdom of a successful career in investing, closely evaluating the performance of companies and their leaders. You will meet eight individualistic CEOs whose firms’ average returns outperformed the S&P 500 by a factor of twenty–in other words, an investment of $10,000 with each of these CEOs, on average, would have been worth over $1.5 million twenty-five years later. In The Outsiders, you’ll learn the traits and methods–striking for their consistency and relentless rationality–that helped these unique leaders achieve such exceptional performance.
Quote: “CEOs, like professional athletes, compete in a highly quantitative field, and yet there is no single, accepted metric for measuring their performance, no equivalent or ERA for baseball pitchers, or complication rate for surgeons, or goals against average for hockey goalies. The business press doesn’t attempt to identify the top performers in any rigorous way. Instead, they generally focus on the largest, best-known companies, the Fortune 100, which is why the executives of those companies are so often found on the covers of the top business magazines. The metric that the press usually focuses on is growth in revenues and profits. It’s the increase in a company’s per share value, however, not growth in sales or earning or employees, that offers the ultimate barometer of a CEO’s greatness. It’s as if Sports Illustrated only put the tallest pitchers and widest goalies on its cover.”
8. Where Are the Customers’ Yachts?
Author: Fred Schwed
Summary: Humorous and entertaining, this book exposes the folly and hypocrisy of Wall Street. The title refers to a story about a visitor to New York who admired the yachts of the bankers and brokers. Naively, he asked where all the customers yachts were? Of course, none of the customers could afford yachts, even though they dutifully followed the advice of their bankers and brokers. Full of wise contrarian advice and offering a true look at the world of investing, in which brokers get rich while their customers go broke, this book continues to open the eyes of investors to the reality of Wall Street
Best Quote: “Customers have an unfortunate habit of asking about the financial future. Now, if you do someone the single honor of asking him a difficult question, you may be assured that you will get a detailed answer. Rarely will it be the most difficult of all answers — ‘I don’t know.'”
Find the book here: Amazon