The best books on value investing from a longtime investor

Gautam Baid Author Of The Joys of Compounding: The Passionate Pursuit of Lifelong Learning
By Gautam Baid

Who am I?

I am the Founder of Stellar Wealth Partners, a SEBI-registered Research Analyst firm and small case manager for investors in the Indian stock market. I am the author of the international best-seller on value investing, The Joys of Compounding. Once a strong foundation is created for a business, owners don’t work for money. Rather, money works for them. As an investor, your money is working for you 24/7. You are becoming wealthier with each passing second, alongside the increasing intrinsic value of your businesses. An investor builds earnings power through a business ownership mindset. 


I wrote...

The Joys of Compounding: The Passionate Pursuit of Lifelong Learning

By Gautam Baid,

Book cover of The Joys of Compounding: The Passionate Pursuit of Lifelong Learning

What is my book about?

Value investing is not just a system for success in the market. It's also an intellectual toolkit for achieving a deeper understanding of the world. In The Joys of Compounding, Gautam Baid builds a holistic approach to value investing and philosophy from his wide-ranging reading, combining practical approaches, self-cultivation, and business wisdom. Baid integrates the strategies and wisdom of preeminent figures whose teachings have stood the test of time. Drawing on the work of investing greats like Warren Buffett, Charlie Munger, and Ben Graham, as well as philosophers and scholars, he artfully interweaves the lessons learned from his many teachers. Baid demonstrates their practical applications in the areas of business, investing, and decision making and also shows that these ideas can be applied to one’s own life with just as much reward.

The books I picked & why

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One Up on Wall Street: How to Use What You Already Know to Make Money in the Market

By Peter Lynch, John Rothchild,

Book cover of One Up on Wall Street: How to Use What You Already Know to Make Money in the Market

Why this book?

In this book, Peter Lynch teaches how a common investor can get great returns from his investment in the stock market if he follows a few general investing principles and a common-sense investing approach. Lynch believes that with a little research and steady discipline, every common person can outperform the so-called investment gurus and make good returns. He suggests that many great investments could be right under their nose, if the investor is ready to do some research. Most people just have to look around the place where they work or the spots where they visit to grab those opportunities. A common person is exposed to many interesting local companies and products years before professional investors would even hear of them. If these investors find and invest in these growing local companies, they can make handsome returns.

One Up on Wall Street: How to Use What You Already Know to Make Money in the Market

By Peter Lynch, John Rothchild,

Why should I read it?

1 author picked One Up on Wall Street as one of their favorite books, and they share why you should read it.

What is this book about?

Peter Lynch believes that average investors have advantages over Wall Street experts. Since the best opportunities can be found at the local mall or in their own places of employment, beginners have the chance to learn about potentially successful companies long before before professional analysts discover them. This headstart on the experts is what produces 'tenbaggers', the stocks that appreciate tenfold or more and turn an average stock portfolio into a star performer. In this fully updated edition of his classic bestseller, Lynch explains how to research stocks and offers easy-to-follow directions for sorting out the long shots from the…

Common Stocks and Uncommon Profits and Other Writings

By Philip A. Fisher,

Book cover of Common Stocks and Uncommon Profits and Other Writings

Why this book?

There are in general two approaches to accumulating wealth in the stock market. One is to time the market, buying stocks when they are cheap, and selling when they are expensive. The other is to find outstanding companies and hold them for the long term. Fisher prefers the latter. He recommends that investors should focus on finding stocks that have the highest profit compared to risk. The public often misinterprets this as meaning stocks that are the most undervalued, rather than those with prospects for the highest growth for the longest duration. High growth over many years outweighs the advantages of an undervalued stock with no growth potential due to compounded returns.

Common Stocks and Uncommon Profits and Other Writings

By Philip A. Fisher,

Why should I read it?

1 author picked Common Stocks and Uncommon Profits and Other Writings as one of their favorite books, and they share why you should read it.

What is this book about?

Widely respected and admired, Philip Fisher is among the most influential investors of all time. His investment philosophies, introduced almost forty years ago, are not only studied and applied by today's financiers and investors, but are also regarded by many as gospel. This book is invaluable reading and has been since it was first published in 1958. The updated paperback retains the investment wisdom of the original edition and includes the perspectives of the author's son Ken Fisher, an investment guru in his own right in an expanded preface and introduction "I sought out Phil Fisher after reading his Common…

Investing for Growth: How to Make Money by Only Buying the Best Companies in the World - An Anthology of Investment Writing, 2010-20

By Terry Smith,

Book cover of Investing for Growth: How to Make Money by Only Buying the Best Companies in the World - An Anthology of Investment Writing, 2010-20

Why this book?

Some people love to make successful investing seem more complicated than it really is. In this anthology of essays and letters written between 2010–20, Terry Smith makes the case for simply buying the best companies in the world. These are businesses that generate large amounts of cash and know what to do with it in the form of sound capital allocation. The result is a powerful compounding of returns for the long term.

This book serves as a good reiteration of the thinking and principles underpinning Smith’s investing approach, including his three-step investment mantra: “Buy good companies. Don’t overpay. Do nothing.” It also highlights the nuances of the process, including why Smith favors return on capital employed (ROCE) and free cash flow (FCF) yield as metrics for assessing companies and why Smith is less enamored of measures such as earnings per share (EPS).

Investing for Growth: How to Make Money by Only Buying the Best Companies in the World - An Anthology of Investment Writing, 2010-20

By Terry Smith,

Why should I read it?

2 authors picked Investing for Growth as one of their favorite books, and they share why you should read it.

What is this book about?

Buy good companies. Don't overpay. Do nothing.

Some people love to make successful investing seem more complicated than it really is. In this anthology of essays and letters written between 2010-20, leading fund manager Terry Smith delights in debunking the many myths of investing - and making the case for simply buying the best companies in the world.

These are businesses that generate serious amounts of cash and know what to do with it. The result is a powerful compounding of returns that is almost impossible to beat. Even better, they aren't going anywhere. Most have survived the Great Depression…

Capital Returns: Investing Through the Capital Cycle: A Money Manager's Reports 2002-15

By Edward Chancellor (editor),

Book cover of Capital Returns: Investing Through the Capital Cycle: A Money Manager's Reports 2002-15

Why this book?

Capital Returns is a comprehensive introduction to the theory and practical implementation of the capital cycle approach to investment. Chancellor says a capital cycle consists of two phases: ‘expansion,’ where the industry production/servicing capacity is increased, and ‘contraction’ where the capacity is reduced by selling assets. With excess profitability, a company or industry’s returns start increasing. This excess profitability attracts new entrants and competitors into it and as they start investing, it results in increased capacity, which leads to a decline in profit, and thus, businesses have to exit capacity and consolidate. When such businesses exit, there is reduced investment and, hence, lower supply, which in turn leads to an increase in profits. Chancellor believes investors who can understand this aspect of the capital cycle can take advantage of the change in the situation and earn good returns.

Capital Returns: Investing Through the Capital Cycle: A Money Manager's Reports 2002-15

By Edward Chancellor (editor),

Why should I read it?

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

What is this book about?

We live in an age of serial asset bubbles and spectacular busts. Economists, policymakers, central bankers and most people in the financial world have been blindsided by these busts, while investors have lost trillions. Economists argue that bubbles can only be spotted after they burst and that market moves are unpredictable. Yet Marathon Asset Management, a London-based investment firm managing over $50 billion of assets has developed a relatively simple method for identifying and potentially avoiding them: follow the money, or rather the trail of investment. Bubbles whether they affect a whole economy or merely a single industry, tend to…

You Can Be a Stock Market Genius: Uncover the Secret Hiding Places of Stock Market Profits

By Joel Greenblatt,

Book cover of You Can Be a Stock Market Genius: Uncover the Secret Hiding Places of Stock Market Profits

Why this book?

The book outlines an array of “special situations” that may offer very profitable opportunities, i.e. bankruptcies, restructurings, merger securities, and spinoffs, among others. Greenblatt underscores the importance of a set of basic ‘rules’ when delving into the universe of special situations: do your own work, don’t trust anyone, pick your spot and assess the downside, not the upside. The basic premise of the book is that it pays off to search for areas where there is a high probability of finding undervalued equities. You can make a lot of money sticking to the tried-and-true method of investing in and holding good companies for many years. However, if you are a more experienced investor looking for other areas to invest part of your portfolio in, this book will give you several new places to explore.

You Can Be a Stock Market Genius: Uncover the Secret Hiding Places of Stock Market Profits

By Joel Greenblatt,

Why should I read it?

1 author picked You Can Be a Stock Market Genius as one of their favorite books, and they share why you should read it.

What is this book about?

A comprehensive and practical guide to the stock market from a successful fund manager—filled with case studies, important background information, and all the tools you’ll need to become a stock market genius.

Fund manager Joel Greenblatt has been beating the Dow (with returns of 50 percent a year) for more than a decade. And now, in this highly accessible guide, he’s going to show you how to do it, too. You’re about to discover investment opportunities that portfolio managers, business-school professors, and top investment experts regularly miss—uncharted areas where the individual investor has a huge advantage over the Wall Street…

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