My Top Book Recommendations for Investing

A conversation is often one of the most enlightening activities you can have...

It is an opportunity to experience the world from another person's perspective, often one that you have not considered before. 

For generations, lessons were handed down to each successive generation through intricate storytelling, with fact and fiction often merging into one. First, this started verbally, then moved to the written word. 

As we have grown as a global society, much of our prosperity can be attributed to the exponentially greater knowledge the written word has allowed us to store collectively. 

Former President Barack Obama once said, "Reading is the gateway skill that makes all other learning possible." If one can master reading, they can digest information that previously would have been impossible to obtain. 

Reading is so important because it doesn't just help you learn. It allows you to have a conversation with people you might never be able to interact with otherwise. Authors and historical figures who have long since passed away can reach across the years to you. 

Reading done right is about engaging and learning – it's not a passive experience... 

This topic came up at a recent presentation I was giving here at Altimetry...

After a recent presentation, some audience members came to talk about the topics we had covered. As the group whittled down, one specific request arose: Is there a book that we at Altimetry recommend? 

Choosing the right book isn't as easy as it sounds. 

To ensure that you're targeting a book that will be an efficient use of your time, you should ask yourself if it's a book for business or pleasure. What kind of learning, and what kind of conversation do you want to have? 

Books for pleasure can have strong lessons you can learn about morality and life, or they might just bring you joy as a casual beach page-turner. 

To be fully honest, I don't have a specific book to recommend reading for pleasure. It's too personal for me to give a broad recommendation. 

Many of the books I have read are about personal growth and being more mindful of my health. Some of the books I've been interested in and have highlighted before are from Dr. Jason Fung and Joshua Waitzkin. 

If you are looking for a business book, you also need to answer more questions before choosing the right one. What are the skills or types of knowledge you want to build on? 

You might be looking to improve your soft skills, like reasoning, negotiation, or identifying biases. You might also need to understand how to start a business or how specific regulations impact your company. 

Traditionally, when it comes to learning more about finance and investing, it's often the big names that come to mind. Perhaps a Benjamin Graham book, such as The Intelligent Investor: The Definitive Book on Value Investing, or, if you can track down a legal (or online) copy, Margin of Safety: Risk-Adverse Value Strategy for the Thoughtful Investor by Seth Klarman. Both are great bibles on value investing. 

To pick the right book for business means looking to fulfill an unmet need. It must be a book that will help patch a hole in the skills you think you need to advance your career. 

If you plan to dedicate so much of your time to reading this book, you want to maximize the chance of coming out of the experience with a different perspective and new insights. 

Whenever I think about which book to read next or which one to recommend to anyone who asks, I always first step back and think about the unmet need the book fulfills. 

Taking stock of your existing knowledge is important before making decisions in life and investing... 

One of my go-to recommendations for anyone looking to invest is a book by Peter Lynch, one of the most prominent value investors of all time. Lynch helped Fidelity become the goliath of finance it is today. 

He taught us great investing starts with first understanding what we already know and the trends we can see around us. 

His landmark book, One Up on Wall Street: How to Use What You Already Know to Make Money in the Market, teaches us that we are already more intelligent than we think as investors. 

Investing is not just staring at spreadsheets and building models. It's a matter of thinking through our knowledge and critically evaluating it. 

Just like how we should rely on our existing knowledge to identify what books to read, we can rely on what we already know to figure out what stocks to focus on. 

It can be as simple as going to your local mall and understanding which stores have positive and lively environments versus the stores that constantly appear to be behind the curve. Take a critical look at which fashions your kids, grandkids, or friends are jumping on, and figure out which companies are exposed. 

After all, as I said above, those conversations with those around you and the conversation between what you learn in books and elsewhere make you smarter. That's true in both investing and life. 

Love, joy, and peace, 

Joel Litman
April 1, 2022 

P.S. One question that I am also asked often is: Where do you believe the smart money is going next? 

Few Americans realize this right now, but big money is now headed to a subsector of the markets very few people are paying attention to. In my brand-new presentation, I explain how this group of companies is behind a totally new type of breakthrough. I also reveal my #1 favorite stock to take advantage of this new trend. You can access it with no-e-mail, subscription, or credit card required by clicking here.