A list of books I'd recommend for investors. Not all are directly related to investing but all have something useful to say about the subject. Clicking through to your local Amazon website from here earns the blog some cash which gets spent on more books to create more content. Which is nice ...
amazon.co.uk amazon.de amazon.fr amazon.ca
Akerlof, G and Shiller, R: Animal Spirits: Why psychology matters for markets and how we should use it for the betterment of all.
Ariely, D: Predictably Irrational: Subtitled "The hidden forces that shape our decisions" - a set of studies on behavioural economics, the irrational but predictable ways that we behave and how this effects our decision making.
Bernstein, P: Against the Gods: The Remarkable Story of Risk: Excellent book explaining the development of the modern notion of risk from the origins of probability through Galton's discovery of mean regression via Keynes and Markowitz to Prospect Theory and chaos.
Bernstein, P: The Power of Gold: Entertaining romp through the history of gold and why it does and doesn't matter.
Bernstein, W: A Splendid Exchange: A history of global trade told in characteristic and entertaining fashion.
Bernstein, W: The Birth of Plenty: Far reaching and eye opening story of how global growth went from zero to where we are today. Covers a huge amount of ground and is really a economic history book written with panache. Recommended.
Bernstein, W: The Four Pillars of Investing: "The stockbroker services his clients in the same way that Bonnie and Clyde serviced banks". Historical perspective on investments and an approach to portfolio development for everyone. Recommended.
Cialdini, R: Influence: Subtitled "The Psychology of Persuasion" this should be read by everyone who's ever made a decision and then wondered why they did so. Hell, it should be read by everyone else as well. Recommended.
Cunningham, L: The Essays of Warren Buffett: Edited and organised essays from the great man. Not easy but absolutely essential. Recommended.
Diamond, J: Guns, Germs and Steel: Jared Diamond explains how the world's successful nations got that way. Broad ranging historical perspective on development based on geography, technology and agriculture.
Dunbar, R: The Trouble with Science: Dissects scientific thinking and why non-scientists don't get it. Equally adept at lampooning stupid scientists and layfolk alike. Shows how decision making often simply isn't rational.
Ferguson, N: The Ascent of Money: Subtitled "A Financial History of the World." History of bonds, equities and all things money related.
Fisher, P: Common Stocks and Uncommon Profits: Classic on stock valuation. All wannabe and actual investors should read it. Recommended.
Gardner, D: Risk: The Science and Politics of Fear: How the media and human psychology cause us to behave irrationally.
Graham, B: The Intelligent Investor: Classic book on stockmarket investment for the professional and amateur alike. Not an easy read for all that - the language is a bit archaic in places. Worth the effort.
Greenblatt, J: The Little Book that Beats the Market: Fund manager Greenblatt's simple rules to outperform the market. I'm not convinced but worth it for his description of how everyone in the securities industry wants your money not your friendship.
Hagstrom, R: Investing The Last Liberal Art: An attempt to get inside Charlie Munger's head by using lessons from Physics, Biology, Psychology and a bunch more subjects to develop a latticework of models for investors. It doesn't quite work for me but it's a good attempt at a difficult topic.
Harford, T: The Undercover Economist: A set of essays on behavioural economics by the author of the eponymous FT column and how this explains everything from the price of coffee to the rise of China.
Hood, B: Supersense: Why we're superstitious and why it matters.
Ibbotson, R and Brinson, G: Global Investing: Numbers, numbers and more numbers - survey of historical data on global investing across multiple asset classes.
Kay, J: Obliquity: Why Our Goals Are Best Achieved Indirectly: Why standard models of economics are wrong and getting rich is best done by approaching the task from the side.
Kindleberger, C: Manias, Panics, and Crashes: When markets go mad. Kindleberger takes up cudgels against those who insist on human rationality in the markets. Not always an easy read but an important one.
Lindstrom, M: Buy:ology: The new science of neuromarketing - why we don't know what we want and what we do about it.
Malkiel, B: A Random Walk Down Wall Street: Classic. Malkiel's explanation of how it's nigh on impossible to beat the market. Recommended.
Mlodinow, L: The Drunkard's Walk: Superb explanation of why randomness is all pervasive and why most of us mistake noise for patterns.
Sagan, C: The Demon Haunted World: Sagan's trip through the phantoms of our minds that haunt us, trip us up and generally lead to mind bogglingly stupid behaviour. Gripping and entertaining.
Schroeder, A: The Snowball: Warren Buffett and the Business of Life: Superb biography of Buffett which explains how the little boys whose favourite toy was a coin counter became the richest man in the world. Schroeder makes no secret of her admiration of the man but never drops to hagiography. Recommended.
Slater, J: The Zulu Principle: Slater's everyman investing book. In some ways it's an update of Philip Fisher's book, but it's clear, consistent and provides lots of basic information for stockmarket investors. Just don't expect to get rich quick.
Sutherland, S: Irrationality: Subtitled "The Enemy Within". The classic study of our losing battle with our own minds.
Taleb, N: The Black Swan: The Impact of the Highly Improbable: Iconoclastic. Funny. Biting. Read it.
Vanderbilt, T: Traffic: What happens to the rational human being when it gets behind the wheel of a car.