The best books on investing from a money manager

Martin S. Fridson Author Of Investment Illusions: A Savvy Wall Street Pro Explores Popular Misconceptions About the Markets
By Martin S. Fridson

Who am I?

I’m a money manager for high-net-worth individuals. During my Wall Street years, I was ranked number one in my category in the Institutional Investor All America Research Survey for nine consecutive years. The CFA Society New York presented me its Ben Graham Award in 2017. I’ve served as a governor of the CFA Institute and consultant to the Federal Reserve Board of Governors. My writings have appeared in the Wall Street Journal, Barron’s, the Financial Times, and various scholarly journals. I live in New York City with my wife, musicologist Elaine Sisman. We have two children and five grandchildren.

I wrote...

Investment Illusions: A Savvy Wall Street Pro Explores Popular Misconceptions About the Markets

By Martin S. Fridson,

Book cover of Investment Illusions: A Savvy Wall Street Pro Explores Popular Misconceptions About the Markets

What is my book about?

I set out to help investors succeed by separating illusion from reality. Investment Illusions exposes the fallacies of reflexive contrarianism, putting faith in “hot” stock pickers, and trying to beat the market by predicting the economy’s direction. The book also alerts readers to a variety of scams, some of which operate legally and in plain sight without being widely recognized as flimflams.

In addition, I highlight certain shortcomings of corporate communications with investors, audited financial statements, mutual fund performance rankings, financial journalism—and books about investing. Along the way, Investment Illusions explains why market curmudgeons’ favorite story of out-of-control speculation, the Tulipmania incident, is almost universally misunderstood. When it comes to financial markets, avoiding avoidable mistakes can pay off more richly than obtaining unique insights.

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The books I picked & why

Book cover of Unconventional Success: A Fundamental Approach to Personal Investment

Why did I love this book?

As head of the Yale University endowment fund, the late David Swensen was one of the foremost innovators and most successful practitioners of institutional investing. Remarkably, he also wrote one of the best books ever for individual investors. Unconventional Success shows why on average, mutual fund investors significantly underperform the funds they own: They trade excessively, buying at the highs and selling at the lows, creating tax inefficiencies in the process. Swensen also valuably details hazards to avoid in fund selection. 

By David F. Swensen,

Why should I read it?

2 authors picked Unconventional Success as one of their favorite books, and they share why you should read it.

What is this book about?

In UNCONVENTIONAL SUCCESS, investment legend David Swensen reveals why the for-profit mutual fund industry consistently fails the average investor, from its excessive management and incentive fees to the frequent 'churning' of portfolios that forces investors to pay higher taxes. Perhaps most destructive of all are flagrant schemes designed to thwart regulators and further erode portfolios, limiting investor choice and reducing returns. Swensen's solution? A 'contrarian' investment alternative that creates more diversified, equity-oriented, 'market-mimicking' portfolios that minimize loss and reward the investor with the courage to stay the course. Swensen backs up his unconventional proposal with well-documented evidence supporting not-for-profit investment…

Book cover of Winning the Loser's Game: Timeless Strategies for Successful Investing

Why did I love this book?

This classic, now in its eighth edition, delivers a needed antidote to the broker- and media-promulgated delusion of easy and obvious paths to index-beating results. Ellis emphasizes less sexy methods that genuinely enhance performance. They include focusing on long-term wealth-building, holding down costs, and paying attention to tax consequences. He supports it all with up-to-date research findings.

By Charles Ellis,

Why should I read it?

5 authors picked Winning the Loser's Game as one of their favorite books, and they share why you should read it.

What is this book about?

The definitive guide to long-term investing success-fully updated to address the realities of today's markets

Technology, information overload, and increasing market dominance by expert investors and computers make it harder than ever to produce investing results that overcome operating costs and fees. Winning the Loser's Game reveals everything you need to know to reduce costs, fees, and taxes, and focus on long-term policies that are right for you.

Candid, short, and super easy to read, Winning the Loser's Game walks you through the process of developing and implementing a powerful investing strategy that generates solid profits year after year. In…

Book cover of The Most Important Thing: Uncommon Sense for the Thoughtful Investor

Why did I love this book?

Forget bromides such as buying a stock because your experience with the company’s product has been good. The hugely successful money manager Howard Marks makes the essential point that the goal is not to find good companies but to make good purchases. “It’s not what you buy,” he says, “it’s what you pay for it.”  Investors who are interested in good outcomes rather than thrills will find many more sound principles in this book.

By Howard Marks,

Why should I read it?

1 author picked The Most Important Thing as one of their favorite books, and they share why you should read it.

What is this book about?

"This is that rarity, a useful book."--Warren Buffett Howard Marks, the chairman and cofounder of Oaktree Capital Management, is renowned for his insightful assessments of market opportunity and risk. After four decades spent ascending to the top of the investment management profession, he is today sought out by the world's leading value investors, and his client memos brim with insightful commentary and a time-tested, fundamental philosophy. Now for the first time, all readers can benefit from Marks's wisdom, concentrated into a single volume that speaks to both the amateur and seasoned investor. Informed by a lifetime of experience and study,…

Book cover of Think Twice: Harnessing the Power of Counterintuition

Why did I love this book?

Investment manager Michael Mauboussin illuminates mental errors that impede investment success with excellent real-life examples. The good news is that these errors are avoidable. Relying on expert opinion is useful in some cases but not in others. Mauboussin also deflates the “great company” myth, citing research that finds the stocks of companies hailed as champions by business magazines subsequently underperform the stocks of companies derided by the same periodicals.

By Michael J. Mauboussin,

Why should I read it?

1 author picked Think Twice as one of their favorite books, and they share why you should read it.

What is this book about?

No matter your field, industry, or specialty, as a leader you make a series of crucial decisions every single day. And the harsh truth is that the majority of decisions-no matter how good the intentions behind them-are mismanaged, resulting in a huge toll on organizations, the people they employ, and even the people they serve. So why is it so hard to make sound decisions? In Think Twice, now in paperback, Michael Mauboussin argues that we often fall victim to simplified mental routines that prevent us from coping with the complex realities inherent in important judgment calls. Yet these cognitive…

Book cover of Your Money and Your Brain: How the New Science of Neuroeconomics Can Help Make You Rich

Why did I love this book?

Financial journalist Jason Zweig shows how the young field of neuroeconomics explains the biological factors underlying smart people’s irrational investment decisions. For example, brain scans show that the fear center lights up when investors consider putting money into foreign stocks, despite the demonstrated value of international diversification. Also to their detriment, investors perceive patterns of returns where none exist. It’s imperative to understand these cognitive errors to get proper control over investments.   

By Jason Zweig,

Why should I read it?

1 author picked Your Money and Your Brain as one of their favorite books, and they share why you should read it.

What is this book about?

Synopsis coming soon.......

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