Good Books for New Investors
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Today, my sister-in-law asked me to recommend a couple of investing books that would be a good start for her. Her prime objective she told me was to ensure that she did not get ripped off by high mutual fund fees and taken advantage of by a broker who sells investment products based on the commissions they generate as opposed to the potential returns the fund could offer.
On a side note, this was a positive comment coming from a new investor like her. The fact that the word is getting out that high mutual fund fees are bad and that some brokers recommend investment products based on their commission as opposed to how good they are for that individual is great. I know there is a long way to go, but at least there are signs of progress.
Back to the topic at hand – good books to start with. I started thinking of the books that really got me interested in investing. At first I thought of books such as The Wealthy Barber but I think she is beyond that. My brother and her are already investing regularly – both savings and pension so that book would probably not cover what she needed. I also know that they don’t want to be as hands on with their portfolio as I am, so I had to keep that in mind. This was actually proving to be more difficult than I thought.
In the end, I decided to provide her with a list of 5 good books that would cover a couple of different areas – asset allocation, stock selection, index funds, etc. This way, she would get a good basic level of understanding and could then decide for herself which areas she wanted to dig into deeper, based on her needs. The list I ultimately gave her is as follows:
1. The Dividend Growth Investment Strategy – RoxAnne Klugman
2. The Little Book of Value Investing – Christopher H. Browne and Roger Lowenstein
3. The Coffeehouse Investor: How to Build Wealth, Ignore Wall Street, and Get On With Your Life – Bill Schultheis
4. The Neatest Little Guide to Stock Market Investing – Jason Kelly
5. Learn to Earn: A Beginner’s Guide to the Basics of Investing and Business – Peter Lynch
I think that is a pretty good start. Of course, there are hundreds of more books out there, but these are all easy to follow and valuable to learn.
11 Comments on this post
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Investorial said:
Good list! I’ll have to check out the coffeehouse investor, sounds interesting!
January 15th, 2007 at 10:37 pm -
antlese said:
Thanks for the list. I’ve been thinking that its time for me to buy another investing book (or two). I’ve read some reviews on the books in your list and I’m going to pick up
The Dividend Growth Investment Strategy – RoxAnne Klugman and The Neatest Little Guide to Stock Market Investing – Jason Kelly.I’ve read the Coffeehouse Investor and really enjoyed it.
Love your site… i visit it often.
Thanks again.January 16th, 2007 at 5:54 pm -
Ken said:
There’s some good books on this list. But if she wants to avoid getting ripped by mutual funds and advisors, the absolute best book is The Naked Investor by John Lawrence Reynolds. It clearly explains how the mutual fund companies and advisors make their money. His critical analysis of the industry will make most people run in the other direction.
January 19th, 2007 at 11:40 am -
Jason Kelly said:
Just a quick note to say thank-you for recommending my book, “The Neatest Little Guide to Stock Market Investing” and for your valuable site. Keep up the good work!
Warm regards,
Jason KellyJanuary 20th, 2007 at 5:20 pm -
The Dividend Guy said:
Jason – well thanks for visiting!! Cool to have a best selling author visiting the site!!
The Dividend Guy
January 20th, 2007 at 6:49 pm -
SM said:
I’d recommend a personal finance software by Australian business Parcus Group.
Easy to use program with features including budgeting, financial planning, real estate analysis, shares valuation, life insurance and a great list of 100s of recomended reading texts, books etc…
Costs under US$24 so it’s not a huge investment but a good value for money.
You can get it on http://www.parcusgroup.com/index.html
or
http://www.parcusgroup.com/index.html
RegardsJanuary 30th, 2007 at 11:26 pm -
Dividend Inc said:
Great site…here are some good books that have advanced my knowledge of dividend investing.
Relative Dividend Yield by Anthony Spare
Single Best Investment by Lowell Miller
Dividends Don’t Lie by Geraldine Weiss
Dow 3000 by Richard Shulman & Thomas BlamerJanuary 30th, 2007 at 11:56 pm
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