Trade Review: Year End Part 3

Obviously in order for me to justify investing/trading I have to confirm that I add value. One way to determine that is measuring my results against a benchmark. Before I do that I must say that I am more inclined to be in the "absolute" return camp.

By measuring success to an arbitrary benchmark I may end up unknowingly limiting my chance for success by making decisions which look favorable as compared to the benchmark but reduce my chance for a larger return. Moreover, the idea that I did not do so bad in any given year as long as I beat selected benchmark seems a bit ridiculous. If my benchmark were the DJIA and that index was down 15% in a given year while my portfolio was only down 5% I would not feel inclined to celebrate that I "beat" the benchmark by 10%. I would be pretty pissed that I lost 5%. So I much rather just focus on maximizing my return without reference to any benchmark.

With that said, I do think that it is important to compare results to a benchmark as a way to determine whether I actually added value to my portfolio. In other words, should I stick with investing for my own account or should I admit that I would be better off seeking help from a professional or even using ETF's to index.

Taking a cue (as I often do) from Bill Rempel I went ahead and used the S&P 500 as a benchmark. In the archive of Bill's original Nodoodahs blog Bill explains why and how to measure returns using the SPY as a proxy for the S&P 500. So I just went ahead and did that as Bill described.

Using the various dates I deposited money into my account as hypothetical purchase dates and using the closing price on each date as my purchase price, I "bought" shares in the SPY. Following that strategy would have resulted in an annualized gain of 13.22%. Therefore, compared to my actual 19.62% return it would appear that I did add value.

There is another benchmark that I am using that is also important to me and a bit more personal. Much of investing is about opportunity cost, you have a limited supply of money to invest and have to decide where to invest it. Like many, my largest debt is my home mortgage and paying it off is a goal I have. Now obviously every dollar I pay down the mortgage is worth xx amount of percent saved, lets say 6%. So if I have $1,000 and send it towards principal, I will earn 6% guaranteed.

When I decided to start investing I told myself that I would do so only if I could at least match that 6% rate of return. If I could not then I saw no point of investing and figured I might as well just start paying down the mortgage. Well so far I did okay this year when compared to that benchmark and will have another go at it in 2007.

Obviously this is my last post of the year. I just wanted to say thank you to all those who have visited and to those who I have corresponded with. It has been a great year for me and all of you were a large part of my success. I just wanted to say thank you.

I look forward to the upcoming year and hope that it is a good year for all of us. To start the year off right, look for my first post of the New Year where I explain just how it was I successfully invest this past year.

See you next year...LOL.

And The Winner Is...

Everybody!

The contest to win a free copy of Ken Fisher's new book is over and the results have been tabulated. As you may have heard the indices closed at: DJIA 12463.15, Nasdaq 2415.29, and S&P 500 1418.30.

Overall we had a sweep by "Lifepost." Lifepost came the closest on all three indices guessing DJIA 12300, Nadsaq 2410, and S&P500 1415. In second place for the DJIA was "Asif" with a guess of 12,700. In second place for the S&P was "Sami" who guessed 1,400. Finally for the Nasdaq "Sami" also came second closest with 2,391.91.

As far as the winners of the books go, it is actually pretty funny. I intended to give away 6 books, 2 to the top two guesses for each index. But since there was only seven people who actually entered the contest, I am going to give a book to each of the seven people who took the time to enter. So everybody at Value Blog Review comes out a winner. Even "Rachelle" who lives in the Philippines.

Please send me an email to the address on my profile page with where you want the book sent. I will try and get them out by the end of the week.

Trade Review: Year End Part 2

Here are how some of the numbers breakdown to my last post on my year end results. Of course, I am no Bill Rempel or Geoff Gannon, so my math may not be perfect.

As I mentioned in the last post, I ended up with a 19.62% annualized gain. The first set of numbers below are the month to month gain or loss from the prior month. The second column is the annualized percent on a month to month basis. It is interesting to note that I should have went flat (all cash) at the end of November. Guess I stayed to long at the party.

Note: I added money several times through the year and used George's spreadsheet as discussed in this post to figure out the numbers.

Jan 0.01% 0.01%

Feb -1.00% -1.00%

Mar 3.58% 2.79%

Apr 1.92% 3.38%

May 0.93% 4.52%

Jun -2.79% 1.00%

Jul 1.26% 2.57%

Aug 5.28% 9.29%

Sep 0.47% 9.91%

Oct 5.39% 12.80%

Nov 5.35% 26.70%

Dec -2.56% 19.62%

I will continue tomorrow with a comparison to a couple of benchmarks to see if I was able to add any value.

Trade Review: Year End Results

I will follow up later this weekend with a monthly breakdown, but I just wanted to drop a quick note to record my year end results.

At the end of my first year investing I can report that I achieved a 19.62% annualized gain.

Later this weekend I will share with you how I did it.

Blog Review: Bill Cara

Bill Cara's blog was one of the first blogs I read when I started investing. It is also one of the best for a new investor. The blog covers all aspects of trading and investing.

Whether you are interested in technical, fundamental, or quantitative analysis, Bill Cara discusses it all. Not too sure what market is right for you? Equities, fixed income, commodities, options, futures, and forex are all covered. Each section has a place on the main page where one can click and get an overview to each category. In addition to all this there are daily posts with commentary and links to research materials.

One of the best things about this site is Bill Cara's Week In Review. Every Saturday Mr. Cara provides an exhaustive analysis of what took place the week before and a look ahead to developing ideas. It is one of the best resources I have found.

Overall Bill Cara's blog is one of the best and I recommend it to all.

Bill Cara's blog

Resource Review: Fraser Publishing Part II

I have mentioned previously here why I like Fraser Publishing. Today I would like to revisit a specific reason why Fraser Publishing is a great resource for investors.

As I said in my original post, Fraser Publishing "offers books you cannot find on Amazon or at a lower price than Amazon because they are now the publisher. If you are looking to build a library of books on trading and investing, as I am, then this bookseller is worth looking at."

Since then I have discovered the website has a category entitled "distressed copies" found here. As described by the website these are books which:

"Sometimes books arrive from the printer a little bit smudged. Sometimes we drop books as we're filling orders, bending the corners a bit. Sometimes books are returned from a bookstore or wholesaler, and, while they haven't been sold to a customer, they're in less than perfect condition. We call these "distressed books", and we're offering them to you at 50% off our regular retail prices."

Currently Fraser Publishing has several books for sale at 50% off including John Burr Williams's classic:




It normally sells for $30.95 but can be had right now for $15.48.









I have ordered several "distressed" books from Fraser Publishing and I have been hard pressed to find anything really distressed about them. Three of the books I ordered are in perfect condition, all that is amiss is a UPC sticker on the back cover. Another has a slight crease on the back cover, as if someone had clumsily browsed through the book too quickly. In all other ways the books were in perfect condition.

So if you want a great book to read and save money when buying it, you might want to visit Fraser Publishing.

The Rediscovered Benjamin Graham - Book Review

The Rediscovered Benjamin Graham: Selected Writings of the Wall Street Legend





What Is It About?

As the title suggests, this book contains selected writings of Benjamin Graham. What makes this book unique is the assembled writings are not in wide circulation. Hence the "undiscovered" part of the title. Culled from speeches, classroom lectures, journal articles, and even Graham's personal papers, the writings provide material not easily found by the average individual.


What Did I Get Out Of It As A New Investor?

As often is the case with all things Graham, what one gets is a deeper understanding of the stock market. The assembled writings span several decades and cover a variety of topics for a myriad of audiences. Whether discussing the need for shareholders to exercise their ownership interests in the thirties or discussing his mature investing philosophy in the seventies shortly before his death, Graham provides insights well worth studying.

One of the best parts of the book is a section that contains GrahamÂ’s address to a group of analysts. At the end of his presentation Graham pauses and says something that I did not expect. I had developed the perception that Graham advocated value investing to the exclusion of all other styles. That is not the case. Rather, he was of the opinion that value investing was best because it worked so well for him. Yet in his address he makes clear that he encouraged the assembled audience to use whatever means that best suited them.

This acknowledgement from Graham is quite powerful because it recognizes each market participant must find their own system. Of course Graham felt a system based on value investing would provide the greatest likelihood for success, yet he did not reject the possibility others may find different means to achieve success. The recognition that each investor or trader must find a style of investing which fits them best is one of the most important things one can learn.


The Good News

Benjamin Graham's thoughts on investing written in his own hand, does one need anything more?


The Bad News

Not much. The worst thing I can say is that despite coming in at 304 pages I felt the book was too short.


Bottom Line

Graham is the man. He was, is, and always will be worth reading. Whether you are a trader or investor, short or long term, reading what Benjamin Graham has to say will improve your ability to succeed. The book is a must read and worth inclusion into oneÂ’s personal library.


Other Related Reading:

Amazon Year End Sale

I just wanted to point out some good book deals that Amazon.com has for this last week of the year.

There are a little over 3,000 books on sale for this next week in several dozen categories. All hardcovers are $4.99 and paperbacks are $2.99.

Here is a sample of some of the more interesting books worth ordering.

From the business section I ordered these books:

Some other books worth noting:

Because she is always so busy I ordered this book for the Trading Goddess:




In addition the Trading Goddess most recently served as the inspiration for this book:




Of course, I must point out that Trader X and Tapeworm inspired the author of this book:




I also was proud to see that Tapeworm was finally able to let go of his pain and set the record straight, so to speak:




It looks like the titles of these two books cancels each side out, which is what led Bill to anarchy:

The Raw Deal: How the Bush Republicans Plan to Destroy Social Security and the Legacy of the New Deal

Reckless Disregard: How Liberal Democrats Undercut Our Military, Endanger Our Soldiers and Jeopardize our Security


This title makes me wonder, if it is so great why is Howard living in Arizona?

Efficient Society: Why Canada is as Close to Utopia as It Gets


Of course the way Shane exploits innocent women every day it is a wonder he has not been accused of writing this book:




I would have never made it on the internet if Jason from Mercado de Estocastica had not sent me this book:

La Internet Para Dummies (La Internet Para Dummies/Internet for Dummies (Spanish))


and finally, if for some reason someone should asks how I want to be treated once I have departed just tell them "the bookworm said:

"

Check the sale out at Amazon.com you just might find a good book for a great price.

Win A Copy Of Ken Fisher's New Book

As my book review details below, Ken Fisher's new book is an outstanding book. Here is your chance to win a free copy, shipping included.

By opening bell (9:30 a.m. EST) December 26, 2006, give me your guess as to what will be the year end (December 29, 2006) closing price for either the DJIA, NASDAQ, or S & P 500 (you can make a guess for more than one index but you can only win one book). The two closest numbers for each index wins a book. In the case of a 3 (or more) way tie the first two who enter a guess win.

I know that some will want to take a guess for bragging rights and do not want a book. Therefore, to make it easier on me to administer the contest please enter a guess with this format:

INDEX NUMBER and either BOOK or NO BOOK

Example

S&P 1400 No Book

or

DJIA 12,800 Book

I will announce an overall winner and the winners of the books for each index shortly after the close on Friday.

Value Blog Review would like to thank the publisher of the book John Wiley & Sons, which was kind enough to provide copies of the book for the contest.

Blog Review: Gannon On Investing

In my opinion, Gannon On Investing is one of the top 5 blogs out there for a new investor. Geoff writes from a strictly value investing point of view. This is not to say that he rejects other points of view; rather, he simply sticks to what he knows. In fact Geoff often discusses other styles of investing not as an exercise to prove them wrong but as a way to examine whether there exists any utility for the value investor.

In addition, the depth of analysis that can be found on Geoff's blog is amazing. Equally as stellar is the quality of the writing, which matches or exceeds what is produced by any institutional report. About the only bad thing about this blog is that Geoff sometimes can go several weeks without a post, which is understandable in light of the amount of time it obviously takes to produce quality research.

If it seems to you as if I am a bit enthusiastic about this blog, your thought is correct. That is why it is one of my top five blogs, measured as helping me to learn during this first year. Whether responding in detailed fashion to questions I may have had or assisting me with my own blog by hosting several of my book reviews, Geoff has contributed greatly to my development as an investor.

If you are just starting to learn how to participate in the stock market (like I was at this time last year) spending time reading Geoff's site may shorten your learning curve, I know it did mine.

Gannon On Investing

Trade Review: JNJ

Inspired by Bill, Trader X, Tapeworm, Ugly, I have decided to discuss trades I have made. These early trades were made as an educational endeavor to understand buying and selling of stocks using minimal amounts of capital. For the most part I bought and sold these shares as I developed my investing and trading process.

Selection

JNJ was a stock I bought as an idea on a relatively undervalued company. The main reason for purchase was just to get my feet wet and I felt JNJ at that time was undervalued enough to present with a sufficient margin of safety that would preserve my capital. So I bought. And then I sold.

Results

On February 17, 2006, I bought Johnson and Johnson (JNJ) at $58.98. As usual I cannot say that there was any particular signal that stood out at that time due to my newness, so again I would describe it as a random entry as discussed in Trade Your Way to Financial Freedom. With the benefit of hindsight, JNJ was overbought, as a check of the chart shows selling as measured by RSI on a monthly basis (as Bill Cara advocates) may have been overdone in late 2005-early 2006.

On April 24, 2006, I sold JNJ at $58.50. I had a loss of $0.48 a share or just about -0.8% in 66 days. Measured as R, my loss of $0.48 was -0.18 R.Why did I sell? At that time I cannot say I had any real reason to sell. I was not nervous or anything. I simply thought I had a better investment I could use the money to buy.

Looking back with what I know now, the Average True Range (thanks Bill) was $0.887 and therefore my R was $2.66 (understanding why R is important comes from Trader Mike). Based on that, my initial stop of 1R should have been $56.32 and a 1R target of $61.64.

Looking the chart on Yahoo it is clear, in hindsight, that JNJ never came close to hitting the stop, with the lowest point in early March at around $57.50. In fact JNJ traded within the ATR for about four months and did not cross over until the close on June 21st at $61.79. Following the Yahoo chart, after the high of $61.79, JNJ came close to hitting the trailing stop a week later on June 28th, closing at $59.23, a mere ten cents away from the trailing stop at $59.13. After that point JNJ made a multi-month move up to the high on October 23rd of $69.41. Using that high close and setting the trailing stop at $66.75, the stop would have dictated a sell on November 8th using the $66.15 close.

Adhering to a stop would have kept me in the stock for a 10.8% gain in a little over 7 months. Expressed as R that is 2.70.


Bottom Line

Once again I had a random entry which, had I used a strict stop, would have resulted in a decent gain.

Blog Review: Update On Bill Rempel aka Nodoodhas

Bill has a great post up today on using Futures vs. Options vs. ETF and how it might or might not impact your measurment of risk. Worth a read.
Bill's Post

Ken Fisher's "The Only Three Questions That Count: Investing By Knowing What Others Don't" - Book Review

The Only Three Questions That Count: Investing by Knowing What Others Don't





What Is It About?

The book rejects the premise that investing is a craft. A craft, like accounting or carpentry, is something that one can practice and obtain proficiency to meet any objective measurement of quality or standard. But, as the author asks, if investing is a craft, why do so very few smart professionals who practice the craft of investing fail to beat the market over time? That is after all the standard of measurement for the craft of investing.

What then is the book about? As the title indicates it is about Investing by Knowing What Others Don't. That is the author's secret, simply knowing what others do not is the way to beat the market. This book makes the case that asking and answering, what do I know that others don't?, is the only way to beat the market.

At its core, this book teaches the reader how to innovate. It does so by showing how an individual can develop their own technology to be a successful investor. This is done by asking three questions related to the primary question above. Those three questions are simply: what is it that I believe that is false, what is it that I can see that others don't, and what it is that I am doing that may be misleading me?


What Did I Get Out Of It As A New Investor?

In order to beat the market over the long term one must develop an investment or trading process which provides the ability to know what other's do not. It is not important to know everything, just those things that others do not. This simple message forms the heart of this book.

This book is not about telling you what tools to use or formula to follow in order to be a successful investor. As the author states in the preface, this book is not called Investing Made Easy. What the book does do well is help a new investor think about the stock market and approach it in a scientific manner.

The book explains in straight forward fashion that knowing what others do not does not require any special or inside knowledge. It simply requires an individual ask and answer three questions. The book details with explanations and examples the author's methodology in practice. Once you determine what is true, determine that others do not fathom it, and ensure that you are not impeding your own progress, you have gleaned an understanding of something that may be utilized to achieve positive results in the stock market. Of course it is easier to say than do, but the point is no other tool will assist you quite as well as the three questions.

It is clear that the author has been successful following the approach he advocates and as such the author writes in a matter-of-fact fashion with no apologies. Having a net worth of several billion dollars, it could be argued, empowers one to do so. But like all great works that seek transformational development of knowledge, as opposed to incremental steps, this book requires one to disavow and question beliefs and practices regarding the stock market. Therefore, this book should be read multiple times simply because the first reading challenges one to examine their investing beliefs, inciting an emotional response from the reader.

Subsequent readings allow for the proper examination of the material in a dispassionate manner. While any book that requires several readings to fully absorb may seem daunting, the hallmark of any book destined to be a classic is one that teaches you something new upon every reading. This one is no different.


The Good News

One of the best books I have read all year. Any choice of superlative is descriptive of this book. For those open and desirous of learning how to succeed in the stock market this book will provide knowledge not easily found elsewhere.


The Bad News

The book at times can seem long, as any book that actually teaches you something can seem. For those firmly devoted to a singular investing paradigm this book will seem heretical. If you do not like leaving your comfort zone and engaging in honest discourse this book may not be for you.


The Bottom Line

It would be a profound understatement to say that this book should be a part of your personal library. It really is a great book.


Other Related Reading:

Blog Review: Accrued Interest

A great blog to read is Accrued Interest. Unlike nearly all other blogs out there that cover equity related topics, Accrued Interest is a blog that covers the bond market. Or as the author of the blog puts it:

"A bond market blog? Seriously? Yes, from the most boring corner of the investment world, its Accrued Interest, a blog about the bond market."

The author, Tom G., describes himself as a professional bond trader who oversees the taxable bond trading for a small investment management firm. The blog is well written and covers all things bond (or interest rate) related. Well worth the read.

We Have A Winner

The first winner of Ken Fisher's new book The Only Three Questions That Count: Investing by Knowing What Others Don't is none other than the Trading Goddess. She correctly identified that my favorite episode of the original Twilight Zone is Time Enough At Last. Don't laugh. For a guy who likes to read books, what happend to Henry Bemis at the end is about the worst thing that can happen. lol.

I still have several more copies of The Only Three Questions That Count: Investing by Knowing What Others Don't and will be announcing a couple of contests this Thursday December 14, 2006 where you too can win a copy of Ken Fisher's The Only Three Questions That Count: Investing by Knowing What Others Don't.

Trade Review: CEF

Inspired by Bill, Trader X, Tapeworm, Ugly, I have decided to discuss trades I have made. These early trades were made as an educational endeavor to understand buying and selling of stocks using minimal amounts of capital. For the most part I bought and sold these shares as I developed my investing and trading process.


Selection

CEF was a stock I bought as an idea on a metal play. The main reason for purchase was just to get my feet wet on buying a stock in a sector I thought was in a trend. At the time I did not really know much about trends, but since then I have found that a good place to learn more on trends and what to do with them is Howard Lindzon’s, blog. CEF seemed a good way to take advantage of what I thought was a positive trend. So I bought. And then I sold.


Results

On February 27, 2006, I bought Central Fund of Canada (CEF) at $7.66. As usual I cannot say that there was any particular signal that stood out, so again I would describe it as a random entry as discussed in Trade Your Way to Financial Freedom. With the benefit of hindsight, it is clear that it was clearly overbought, but not violating the trend.

On April 20, 2006, I sold CEF at $9.20. I had a gain of $1.54 a share or just about 16.8% in 53 days. Measured as R, my gain of $1.54 was 2.44 R.

Why did I sell? At that time I cannot say I had any real reason to sell. I simply was amazed that I had gained 16.8% (or 2.44 R) in less than two months and figured it was due more to luck than skill so I better take while the taking was good. Again looking back with what I know now, the Average True Range (thanks Bill) was $.212 and therefore my R was $.63 (understanding why R is important comes from Trader Mike). Based on that, my trailing stop should have been $.63.

Following a chart it is clear that CEF made a high on 4/19 of $9.84 and then closed down at $9.08, a loss of $0.76 cents. So my “gut” decision to sell, even though I had no idea, was actually the right thing to do based on the trailing stop of $0.63 cents. In hindsight, my decision to sell was actually sound based on the trailing stop, although I had no idea of that at the time.


Bottom Line

I did not use a stop and got lucky. Once again I had a random entry which worked out well based on the stop. Stops are showing themselves helpful in protecting profits.

Win A Copy of Ken Fisher's New Book

As I have mention here and here, Ken Fisher is out with a new book, The Only Three Questions That Count: Investing by Knowing What Others Don't. I am reading it right now and plan to review it soon, but so far it is a great book.

As a way of saying thank you to the readers of Value Blog Review, I am going to be having several contests this month to give away copies of the book. The contest is sponsored by the publisher of the book John Wiley & Sons, which was kind enough to provide several copies of the book to share with my readers.

Of course once I had to actually come up with ideas for a contest my mind drew a blank for the most part. Here are two of my favorite ideas.

First Contest

The first contest is that I have decided to have a contest to pick a contest. If you have a good idea for a contest please put it in the comments section of this post. If I use your idea you will win a free copy of the book. I may end up picking more than one idea, but you can only win once, either in this contest or any other although you may participate.

Some basic ground rules: It does not have to be stock market related, although I do have a preference for that. It should be simple enough that anybody can take a shot. Whether it is stock market related or not it should be a short contest and should not run longer than a month.

Second Contest

I think I have come up with a simple contest to reward those who have been paying attention while reading my site and have a little fun at my own expense.

Growing up I used to love watching re-runs of the original Twilight Zone television series. One particular episode was my favorite and my family and friends would laugh every time it came on because the ending was so perfectly tragic to me and I would always say "man that ending really sucks." If you read my site, some of my comments, and know the old Twilight Zone episodes it should be pretty easy.

The first person who guesses my favorite original Twilight Zone episode wins a free copy of Ken Fisher's book. You can either give me the exact title of the episode or just describe the story and ending enough so that I recognize it.

Trade Review: LXK

Inspired by Bill, Trader X, Tapeworm, Ugly, I have decided to discuss trades I have made. These early trades were made as an educational endeavor to understand buying and selling of stocks using minimal amounts of capital. For the most part I bought and sold these shares as I developed my investing and trading process.


Selection

LXK was one of the first stocks I bought. The main reason for purchase was just to get my feet wet. I did do some research (among other things, a good fundamental look at LXK at the time of purchase can be found at Geoff Gannon's Gannon On Investing blog) and felt it to be suitable for purchase. So I bought. And then I sold.


Results

On February 16, 2006, I bought Lexmark (LXK) at $47.80. I cannot say that there was any particular signal that stood out, so again I would describe it as a random entry as discussed in Trade Your Way to Financial Freedom. With the benefit of hindsight, and with what I have learned this past year at Bill Cara's blog, I can say that my buying was partially supported by the fact that the daily, weekly, and monthly RSI were at or near an oversold level.

On April 24, 2006, I sold LXK at $46.91. I had a loss of -$0.89 cents a share or just about 1.9% in 67 days. Measured as R, my loss of $0.89 was -0.28 R.

Why did I sell so soon? I cannot say I had any real reason to sell. Mainly just a FNG getting nervous. Again looking back with what I know now, the Average True Range (thanks Bill) was $1.07 and therefore my R was $3.22 (understanding why R is important comes from Trader Mike). Based on that, my stop should have been $44.58.

Looking back at the one year chart (and using the closing price), it is clear that the closest the stop came to getting triggered was the close of $45.01 on May 12, 2006. A stop as described above would not have been hit. The question then is, if I had known to use stops I would have been better off?

Umm, does a bear crap in the woods?

Following the one year chart it is clear that LXK bounced off that low close of $45.01. On May 31, 2006, LXK closed at $57.25 and then closed at $53.80 on June 9. Using a stop may have got me out at around $53.80, for a $6.00 (11.2%) gain or 1.86 R in about 4 months.


Bottom Line

Using a stop would have turned my small loss into a decent gain. So far using a random entry with an ATR stop would have done much to improve my results. Clearly stops are helpful in removing some of the emotion a new trader may have.

Supermoney - Book Review

Supermoney (Wiley Investment Classics)





What Is It About?

This book is the follow up to the authors first book, Money Game. My review of the first book is here. The second book continues were the first left off and provides further insight into Wall Street.


What Did I Get Out Of It As A New Investor?

As was the case with Money Game this book details the madness that happens on Wall Street and in the general world of finance. The best part of this book is found in chapter 5. In that chapter the author details how Benjamin Graham contacted him asking him to collaborate with a former student to update Intelligent Investor. That former student was Warren Buffett.

The author recounts his meeting with Buffett and discussing Buffett’s investing philosophy. The book is considered to be one of the earliest, if not the first, that provides a close look at Warren Buffett. This early insight into Buffett is alone worth the read.


The Good News

This book is a great read. As mentioned, the chapter on Warren Buffett is excellent.


The Bad News

Like all sequels, while coming close, it does not surpass the original work. The middle part of the book, while interesting, does drag a bit.


The Bottom Line

The chapter on Buffett alone makes this book a must read. Moreover, if you are considering compiling a library of investment classics this book should be included.


Other Related Works: