Author Topic: Best read books lately?  (Read 2149 times)

BoostJunky

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Best read books lately?
« on: May 27, 2020, 07:43:53 AM »
Anyone have any good books to reccomend on general investing? It seems when I search Amazon I get a billion hits and its hard to sort through.

I am a new investor a little later in life (35) and understand the concept of maxing Roth IRA every year and buying index funds. I was looking for a book that talked more about trading and investing funds outside the ira. My wife has an IRA and pension through work as well. I'm self employed.

I'd like to learn about investing in bonds and gold/oil as well.
« Last Edit: May 27, 2020, 07:46:33 AM by BoostJunky »

celerystalks

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Re: Best read books lately?
« Reply #1 on: May 27, 2020, 07:50:07 AM »
Investing in bonds: buy a bond fund.

Investing in oil: donít

Investing in gold: buy a few gold coins, put them in a safe and keep quiet about it.

MyOtherBrotherDarryl

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Re: Best read books lately?
« Reply #2 on: May 27, 2020, 12:19:32 PM »
I'd start with these three, in any order:

Malkiel's A Random Walk Down Wall Street.

Bogle's Bogle on Mutual Funds.

Graham's The Intelligent Investor.

For fun, I'd also recommend Lewis's The Big Short for an easy-to-read overview of the last financial crisis and how people react during good times and financial crises alike.

BoostJunky

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Re: Best read books lately?
« Reply #3 on: May 27, 2020, 12:59:06 PM »
I'd start with these three, in any order:

Malkiel's A Random Walk Down Wall Street.

Bogle's Bogle on Mutual Funds.

Graham's The Intelligent Investor.

For fun, I'd also recommend Lewis's The Big Short for an easy-to-read overview of the last financial crisis and how people react during good times and financial crises alike.

Thank you!

vand

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Re: Best read books lately?
« Reply #4 on: May 28, 2020, 09:00:39 AM »
The two recommendations I would give from audiobooks I've listened to over the last year would be:

Howard Marks - The Most Important Thing
Andrew Craig - How To Own The World

Neither of these simple are FI manuals that just tell you to passively index. Rather, they strive to teach you to become a knowledgeable investor. The 2nd book is primarily aimed at UK investors for purposes of tax and savings, but the investment stuff is globally relevant.

Ichabod

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Re: Best read books lately?
« Reply #5 on: May 28, 2020, 01:28:52 PM »
Not a book, but I recommend JL Collin's stock series. https://jlcollinsnh.com/stock-series/

It covers asset allocation and investing order and the other basic stuff.

It looks like he's expanded since I read through it all. I look forward to seeing what he's added.

BicycleB

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Re: Best read books lately?
« Reply #6 on: May 28, 2020, 02:05:01 PM »
(post got swallowed)

Great suggestions from @vand and @Ichabod!

Howard Marks's "Mastering the Market Cycle" was very good for me. Stunned me by finally getting me to understand that the year to year distribution of stock market returns is different from what I had assumed it was.

Another good resource is the Early Retirement Now website. Its "Safe Withdrawal Rate" series alone, available as several dozen articles accesible through a single tab on the website's landing page, has the detail and intellectual heft of a serious investing book focused on early retirement.
https://earlyretirementnow.com/

Also, you can use portfoliocharts.com as a free resource. Its brief but thoughtful introductions to investing topics and particular assets are excellent. Its core offering is a series of calculators that display results in chart and numeric formats for the purpose of studying historical results of various investment strategies. This allows you to study portfolio construction, which by the way is IMHO a better topic to focus on than "trading" funds or stocks.
https://portfoliocharts.com/

Personal thought - trading is expensive entertainment, and when you win, you usually win less than you do just by going to work. Constructing an investment portfolio that exquisitely meets your investing needs - that, my friend, is prosperity in a bottle.

PS. portfoliocharts.com includes data and discussion of gold
« Last Edit: May 28, 2020, 02:08:00 PM by BicycleB »

BicycleB

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Re: Best read books lately?
« Reply #7 on: May 28, 2020, 02:21:45 PM »
Investing in bonds: buy a bond fund.

....

This is good advice!

Bonds are notoriously complex, surprisingly so for something that can appear to be a fixed investment. Unlike stock funds, it is relatively likely that your fund manager is adding value.

Bond funds can therefore be used efficiently as a component in a portfolio that distributes - "allocates" - your investments among different asset categories (bonds, stock, gold; possibly REITs, commodities...oil can be a commodity). Most investment studies suggest that the bulk of value in investment decisions comes from selecting the correct asset allocation.

Obviously the next factor is efficiency within the asset category. So, for stocks, choosing a reasonable low cost index fund. You already know that, probably - but the suggestions upthread will detail it nicely! They will also discuss allocation issues quite well; that's especially a focus on Early Retirement Now.

As far as "general investing" goes, I think that asset allocation and efficient investment selection are two most important topics. The next would be specifics regarding investment goals. The book I recommended doesn't discuss any of these directly. ERN and portfoliocharts address the key investing issues directly for someone seeking financial independence. As far as I know, they do so more directly than any of the books we've recommended, though I will accept correction (I haven't read all of the books!).
« Last Edit: May 28, 2020, 02:27:23 PM by BicycleB »

vand

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Re: Best read books lately?
« Reply #8 on: May 28, 2020, 02:39:57 PM »
I listen to a lot of podcasts too - right now I'm currently listening to Meb Faber's podcast. Episode #001 is already a brilliant primer on the topic of asset allocation. Did you know that even the model 60/40 portfolio lost over 2/3rds in the great depression?

Currently on #20, so only another 200 or so to go. Highly recommended.

Imanuels

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Re: Best read books lately?
« Reply #9 on: May 30, 2020, 01:35:19 PM »
I definitely add +1 to Meb Faber's podcast. I've been listening to it recently on my way to work, did Episode #206 last week. Highly recommend.
By the way, Vand do you have any thoughts on his market timing model using 10-month SMA? It would underperform buy and hold slightly, but with significantly reduced max drawdown which might be psychologically beneficial for many investors to avoid behavioral mistakes.

I listen to a lot of podcasts too - right now I'm currently listening to Meb Faber's podcast. Episode #001 is already a brilliant primer on the topic of asset allocation. Did you know that even the model 60/40 portfolio lost over 2/3rds in the great depression?

Currently on #20, so only another 200 or so to go. Highly recommended.

MustacheAndaHalf

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Re: Best read books lately?
« Reply #10 on: May 30, 2020, 10:18:41 PM »
Most of the above books are hundreds of pages.  If you want a 96 page book that is based on decades of stock market history, I'd recommend "The Investment Answer".  You can probably find it in your local library, but surprisingly it's just $3.50 on Amazon right now:
https://www.amazon.com/Investment-Answer-Manage-Protect-Financial-ebook/dp/B004FGLXOM/


I was really disgusted with Meb Faber's "Global Asset Management" book.  He misrepresents every famous investor I checked up on, to make them all fit his theory that nobody performs well.  Warren Buffet is not represented by the company he runs, but instead "Buffet" becomes the S&P 500.  Larry Swedroe becomes a portfolio with no "small cap value" stocks, which is the key thing Swedroe has been pushing for years.  Faber's book goes on like that, mis-representing each famous portfolio to fit a pre-conceived idea that none of them had good performance.  I haven't liked Meb Faber since I noticed how badly he mis-represents famous portfolios in the book Global Asset Management.

vand

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Re: Best read books lately?
« Reply #11 on: May 31, 2020, 01:34:23 AM »
I definitely add +1 to Meb Faber's podcast. I've been listening to it recently on my way to work, did Episode #206 last week. Highly recommend.
By the way, Vand do you have any thoughts on his market timing model using 10-month SMA? It would underperform buy and hold slightly, but with significantly reduced max drawdown which might be psychologically beneficial for many investors to avoid behavioral mistakes.

I listen to a lot of podcasts too - right now I'm currently listening to Meb Faber's podcast. Episode #001 is already a brilliant primer on the topic of asset allocation. Did you know that even the model 60/40 portfolio lost over 2/3rds in the great depression?

Currently on #20, so only another 200 or so to go. Highly recommended.

I think there's a good case to be made for trend following strategies.  In general I am in favour of any strategy that trade risk for return in a ratio that moves you closer to the efficient frontier. 

Imanuels

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Re: Best read books lately?
« Reply #12 on: May 31, 2020, 02:03:01 AM »
Interesting, thanks for pointing this out. Haven't read any of his books jet, but will keep it in mind once get to one.
Most of the above books are hundreds of pages.  If you want a 96 page book that is based on decades of stock market history, I'd recommend "The Investment Answer".  You can probably find it in your local library, but surprisingly it's just $3.50 on Amazon right now:
https://www.amazon.com/Investment-Answer-Manage-Protect-Financial-ebook/dp/B004FGLXOM/


I was really disgusted with Meb Faber's "Global Asset Management" book.  He misrepresents every famous investor I checked up on, to make them all fit his theory that nobody performs well.  Warren Buffet is not represented by the company he runs, but instead "Buffet" becomes the S&P 500.  Larry Swedroe becomes a portfolio with no "small cap value" stocks, which is the key thing Swedroe has been pushing for years.  Faber's book goes on like that, mis-representing each famous portfolio to fit a pre-conceived idea that none of them had good performance.  I haven't liked Meb Faber since I noticed how badly he mis-represents famous portfolios in the book Global Asset Management.

vand

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Re: Best read books lately?
« Reply #13 on: May 31, 2020, 02:52:32 AM »
Most of the above books are hundreds of pages.  If you want a 96 page book that is based on decades of stock market history, I'd recommend "The Investment Answer".  You can probably find it in your local library, but surprisingly it's just $3.50 on Amazon right now:
https://www.amazon.com/Investment-Answer-Manage-Protect-Financial-ebook/dp/B004FGLXOM/


I was really disgusted with Meb Faber's "Global Asset Management" book.  He misrepresents every famous investor I checked up on, to make them all fit his theory that nobody performs well.  Warren Buffet is not represented by the company he runs, but instead "Buffet" becomes the S&P 500.  Larry Swedroe becomes a portfolio with no "small cap value" stocks, which is the key thing Swedroe has been pushing for years.  Faber's book goes on like that, mis-representing each famous portfolio to fit a pre-conceived idea that none of them had good performance.  I haven't liked Meb Faber since I noticed how badly he mis-represents famous portfolios in the book Global Asset Management.

https://mebfaber.com/wp-content/uploads/2016/04/GAA-Book-1.pdf

He has not misrepresent Buffett at all. He has accurately presented Buffett's advice "to put 90% in the S&P and 10% in bonds."

It is not in any way intended to represent Berkshire.

And for Swedroe, he very clearly gives 2 models - one with a 15% weight to US Small cap, and one with a 15% wieghting to SCV, so I don't know how you are interpreting his interpretation, but you're basically talking nonsense.
« Last Edit: May 31, 2020, 02:58:00 AM by vand »

MustacheAndaHalf

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Re: Best read books lately?
« Reply #14 on: May 31, 2020, 08:31:58 AM »
I was really disgusted with Meb Faber's "Global Asset Management" book.  He misrepresents every famous investor I checked up on, to make them all fit his theory that nobody performs well.  Warren Buffet is not represented by the company he runs, but instead "Buffet" becomes the S&P 500.  Larry Swedroe becomes a portfolio with no "small cap value" stocks, which is the key thing Swedroe has been pushing for years.  Faber's book goes on like that, mis-representing each famous portfolio to fit a pre-conceived idea that none of them had good performance.  I haven't liked Meb Faber since I noticed how badly he mis-represents famous portfolios in the book Global Asset Management.

https://mebfaber.com/wp-content/uploads/2016/04/GAA-Book-1.pdf

He has not misrepresent Buffett at all. He has accurately presented Buffett's advice "to put 90% in the S&P and 10% in bonds."

It is not in any way intended to represent Berkshire.

And for Swedroe, he very clearly gives 2 models - one with a 15% weight to US Small cap, and one with a 15% wieghting to SCV, so I don't know how you are interpreting his interpretation, but you're basically talking nonsense.
why is Warren Buffet famous?

He's famous for running Berkshire Hathaway for decades, and being one of the best investors of all time.  Yet you and Mr Faber discard all of that, and give the S&P 500 portfolio the name "Buffet".  Buffet isn't famous for one quote, he's famous for his investing success, which involves Berkshire Hathaway.  Why won't you acknowledge that?

Look on any financial website - they call the S&P 500... "S&P 500".  There's no need to give it another name, unless an author like Mr Faber is trying to mislead people about Warren Buffet.  Calling the S&P 500 "Buffet" is misleading.

---
Does Mr Faber represent Larry Swedroe with a 70% bond portfolio?

Larry Swedroe's most popular books all allocate more than half to equities.  My favorite would be  "The Only Guide to a Winning Investment Strategy You'll Ever Need", which shows how a 60% stock / 40% equity portfolio can be given higher returns with less volatility by tilting towards small cap, value and REITs.
https://www.amazon.com/gp/product/B003K15OJI/

vand

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Re: Best read books lately?
« Reply #15 on: May 31, 2020, 01:28:53 PM »
I was really disgusted with Meb Faber's "Global Asset Management" book.  He misrepresents every famous investor I checked up on, to make them all fit his theory that nobody performs well.  Warren Buffet is not represented by the company he runs, but instead "Buffet" becomes the S&P 500.  Larry Swedroe becomes a portfolio with no "small cap value" stocks, which is the key thing Swedroe has been pushing for years.  Faber's book goes on like that, mis-representing each famous portfolio to fit a pre-conceived idea that none of them had good performance.  I haven't liked Meb Faber since I noticed how badly he mis-represents famous portfolios in the book Global Asset Management.

https://mebfaber.com/wp-content/uploads/2016/04/GAA-Book-1.pdf

He has not misrepresent Buffett at all. He has accurately presented Buffett's advice "to put 90% in the S&P and 10% in bonds."

It is not in any way intended to represent Berkshire.

And for Swedroe, he very clearly gives 2 models - one with a 15% weight to US Small cap, and one with a 15% wieghting to SCV, so I don't know how you are interpreting his interpretation, but you're basically talking nonsense.
why is Warren Buffet famous?

He's famous for running Berkshire Hathaway for decades, and being one of the best investors of all time.  Yet you and Mr Faber discard all of that, and give the S&P 500 portfolio the name "Buffet".  Buffet isn't famous for one quote, he's famous for his investing success, which involves Berkshire Hathaway.  Why won't you acknowledge that?

Look on any financial website - they call the S&P 500... "S&P 500".  There's no need to give it another name, unless an author like Mr Faber is trying to mislead people about Warren Buffet.  Calling the S&P 500 "Buffet" is misleading.

---
Does Mr Faber represent Larry Swedroe with a 70% bond portfolio?

Larry Swedroe's most popular books all allocate more than half to equities.  My favorite would be  "The Only Guide to a Winning Investment Strategy You'll Ever Need", which shows how a 60% stock / 40% equity portfolio can be given higher returns with less volatility by tilting towards small cap, value and REITs.
https://www.amazon.com/gp/product/B003K15OJI/

Your complaint against the book was that it you think it is written to support some sort of personal biased view that Faber holds about all these portfolios that  ďnone of them have good performanceĒ.. which is not what the book or the whole point of asset allocation is about. Asset allocation canít magically earn you more than what the best performing asset in the world delivers - you canít take 8 plus 5 and somehow get 20. That is basically why all the portfolios end up with less total return than the 100% stock portfolio. The point, literally the WHOLE point - is to create a portfolio blend that is more stable and predictable  by holding a mix of assets in such a fashion that it trades as few units of performance for as many units of risk reduction as possible.

Of course there are those who do manage to outperform a 100% S&P portfolio over time, but that is due to their active investing skill - positive alpha, smart beta, factor investing or whatever, not due to their asset allocation. Lump Buffett and other such super-investors in this category.

I highly doubt Faber is trying to mislead anyone or somehow deny Buffett his stock picking kudos. That is not my impression at all. He doesnít call it the S&P portfolio because guess what? Itís not 100% S&P,  itís 90% with 10% bonds. Call it the Buffett portfolio, the 90/10, Brian or whatever else you want.. it doesnít change the message that is being conveyed.
« Last Edit: May 31, 2020, 01:39:08 PM by vand »

MustacheAndaHalf

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Re: Best read books lately?
« Reply #16 on: May 31, 2020, 08:09:24 PM »
You are defending calling the S&P 500 by the name "Buffet" because you read Meb Faber's book.  Doesn't that tell everyone else what they need to know about the book?

Why compare 100% S&P 500 to a mix of 90% S&P 500 / 10% bonds?  Why call that "Buffet"?  The sole aim is to sideline Buffet's real performance - he beat the S&P 500 for decades.  But instead of using that track record, the book compares the S&P 500 to itself, and gives it the name "Buffet".  The S&P 500 was called "Bogle's Folly" by skeptics who didn't believe in the future of index investing.  The most appropriate person to associate with championing investing in the S&P 500 would be Vanguard founder John Bogle.

I believe there's also other misrepresentations like David Swensen, who is famous for his investment returns as head of the Yale Endowment.  Private equity investments are very high risk, but provided Yale's Endowment with higher returns.  What does Meb Faber do in his book?  Discard the allocation to private equity.  He doesn't explore how private equity is outside the public markets, and therefore doesn't have to add up to the market return.  Instead Swensen's performance is misrepresented without an allocation to private equity.


And for Swedroe, he very clearly gives 2 models - one with a 15% weight to US Small cap, and one with a 15% wieghting to SCV, so I don't know how you are interpreting his interpretation, but you're basically talking nonsense.
It's misleading comparing 100% equities to 30% equities, but in Meb Faber's book in appendix F he does exactly that:
https://mebfaber.com/wp-content/uploads/2016/04/GAA-Book-1.pdf#page=104

Where is the small cap value tilt you claim Meb Faber uses?  It's not there, because he has decided to use the lowest equity allocation of any portfolio Swedroe ever used.  There's no value tilt, where large caps are split between large cap and large cap value.  There isn't even an allocation to "small cap value", because Meb Faber doesn't admit that category exists: in his pre-defined categories, there's only "US Large cap" and "US Small cap".  By hacking away at the things that make Swedroe unique, Faber avoids admitting that historically tilts to small cap and value have beaten the market - which would destroy his thesis that famous investors have similar performance to the market.

Avoiding private equity for a "Swensen" portfolio is misleading.
Stripping out "small cap value" and "large cap value" and calling that a Swedroe portfolio is misleading.
Comparing 100% equities to 30% equities is misleading.
Giving the S&P 500 the name "Buffet" is misleading.

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Re: Best read books lately?
« Reply #17 on: June 09, 2020, 07:32:18 AM »
Since it has not been mentioned (that I can tell) I'd recommend The Intelligent Asset Allocator, by William Bernstein, as well as Gibson's book, Asset Allocation. Both make the argument that asset allocation factor far more into a successful portfolio than do ether market timing (which no one can do) or stock selection. I'd also recommend The Boglehead's Guide to Investing.

I have a number of Bernstein's books, While they are all good I consider the above, plus The Four Pillars of Investing to be his best efforts. A Random Walk is another great read.  I'm reading this plus the asset allocation books right now.

simplyjay

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Re: Best read books lately?
« Reply #18 on: June 27, 2020, 05:38:25 PM »
Read "affluenza" this will teach you the real cost of being money hungry with no real purpose and read retire before mom and dad by rob burger.

BoostJunky

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Re: Best read books lately?
« Reply #19 on: July 08, 2020, 06:02:41 AM »
I just wanted to say thanks again to those who took the time to post. I'm going to go through all this stuff.

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Re: Best read books lately?
« Reply #20 on: July 11, 2020, 10:59:14 AM »
Here's another: The Only Guide to a Winning Bond Strategy You'll Ever Need, By Larry Swedroe (and Joseph Hempen). If you are going to read any book on bonds (and you should), this is it.

seattlecyclone

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Re: Best read books lately?
« Reply #21 on: July 11, 2020, 02:38:38 PM »
I was pretty happy with Money for the Rest of Us, based on the podcast of the same name. It's a nice intermediate-level walk through principles of investing. While much of it was not new to me, I did pick up a few ways of thinking about investments that I hadn't considered before.

PDXTabs

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Re: Best read books lately?
« Reply #22 on: July 11, 2020, 09:46:51 PM »
Not a book, but I recommend JL Collin's stock series. https://jlcollinsnh.com/stock-series/

I recommend his book The Simple Path to Wealth: Your road map to financial independence and a rich, free life.

PDXTabs

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Re: Best read books lately?
« Reply #23 on: July 11, 2020, 11:35:06 PM »
Read "affluenza" this will teach you the real cost of being money hungry with no real purpose and read retire before mom and dad by rob burger.

Thanks, I just added it to my list.

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Re: Best read books lately?
« Reply #24 on: July 16, 2020, 01:21:00 PM »
Read "affluenza" this will teach you the real cost of being money hungry with no real purpose and read retire before mom and dad by rob burger.
Also: Stop acting Rich, By Thomas Stanley.

Murdoch

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Re: Best read books lately?
« Reply #25 on: July 27, 2020, 07:49:19 PM »
I've read a few of the books listed, and may look at some others I hadn't heard of. Thanks all.

Not a book, but the BogleHeads Wiki page is a trove of information in bite size chunks.

If you haven't read all the MMM articles, then put them on the list. Not books or necessarily investment product advice, but your behaviours probably dictate eventual outcomes a lot more than asset splits or product choice etc...

Post modified: I recently read AntiFragile and found it interesting for a whole range of reasons. Recommended.

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« Last Edit: July 27, 2020, 07:51:00 PM by Murdoch »