5 comments about Buffettology: The Previously Unexplained Techniques That Have Made Warren Buffett The Worlds.

1. If I could only recommend one stock investing book, this would be it! I can't recommend a book any higher. It answers in a way that is easy to understand the two most fundamental questions of investing in the stock market: 1-what kind of stocks should I buy? and 2- at what price? Thank Ms.Buffett and Mr. Clark for publishing this book. It has shaped my every investing decision since reading it more than a decade ago.



2. This is a pretty handy book. Of course, like most books of this type, it could be a lot shorter.
   
   The basic principal: (1) find a company whose earnings are reasonably predictable, (2) make some sort of forecast of those earnings going forward ~10 years, (3) use the company's ROE to calculate what sort of value creation they should make with the portion of the earnings that aren't paid out as a dividend and (4) use the historic P/E range to imply some future stock price. Then use the current stock price to decide if you'll get a reasonable return on your investment.



3. Let me start off by saying that I agree with those who note that this books marketing strategy- relying heavily on the "Mary Buffett" name- is most certainlly a bit misleading. Pretty safe to say that Mary Buffett isn't much of an expert on her former father-in-law and if one were to completely remove her name from this book, it quite likely wouldn't sell as many copies as it has. I assumed this from the outset and after completing the book, I soon realized that my assumptions were correct. I seriously doubt that Mary Buffett wrote a single word of this book and even if she had, I think her last name overvalues her actual understanding of what WB is all about.
   
   With that said, objectively considering "Buffettology" as being nothing more than a book that proffers a simplified value investing strategy similar to the one practiced by WB's (in a broad sort of way) this book is surprisingly good indeed. Buffettology outlines a (very) basic framework for Buffetts philosophy of investing, which is an interesting amalgam of Ben Graham (pure value), Phil Fischer (pure upside considerations) and uniquely Warren Buffett (the ability to pick the winners at the right times). It also provides just enough technical information- particularly on calculations- to be extremely useful to the beginner or the layperson.
   
   All in all, I would highly, highly recommend this book to beginners who are still developing their sea-legs in the investing world and are trying to figure out exactly what kind of investor they really are. Also, for advanced investors who themselves are more the market-timer types but find themselves interested in gaining a very basic comprehension of what value investing is all about, this book would be a superb starting point.
   
   I think Buffettology occupies a pretty good place in the realm of beginners investing literature. I wouldn't hesitate to recommend it to most anyone.



4. BOTTOM LINE:
   
   INVESTMENTS - It's all about the basics!
   This is my personal investment bible. First read it back in 1999; still refer back to it when pondering my next investment move. Mary goes DEEP into the mind of Warren and shares all of his secrets. She even bothers doing the math for us. I have found that the worksheets still 'work', even with today's constantly-changing internet market.
   A+



5. This book was very good - especially the first half, before it gets heavily into the math equations. It was right about at my limits of understanding, (as a math-minded, but a relatively inexperienced investor) and I appreciated the numerous examples. The author had a rough task in making the book readable for folks like me as well as MBAs and more experienced investors. I thought she did a decent job, but did leave off some definitions of terms from balance sheets and cash flow statements.
   
   I found a math error in the first part of the math section, and gave up from there, but the earlier parts of the book still made it very much a worthwhile read.

5 comments about Winning the Loser's Game.

1. Charles was not the first to blow the whistle on active investing but was the first to write a book for the average investor. His advise and counsel are outstanding. In fact he has been called by the current administration to establish criteria for self funded social security investing. The book is a basic tutorial every investor should have on his bookshelf.
   
   Piscaqua Research in a study covering the period 1987-96 found that only 10 out of 145 major pension funds, or just seven percent, out performed a portfolio consisting of a simple 60%/40% mix of the S&P 500 index and the Lehman Bond index respectively.
   
   Or is it logical I ask for you to believe that you can predict which actively managed funds will out perform, or are you overconfident of your skills? If you are trying to find the great fund managers who will out perform in the future ask yourself: what am I going to do differently in terms of identifying the future winning fund managers, than did the pension plans and their advisors? And if you are not going to something different what logic is there in playing a game at which others with superior resources have consistently failed?
   
   If you a really serious in finding an investment technique that will provide you with reasonable return with less risk I suggest the following little book. This is a little book that I have written and contains the essential of how to invest. Just click on the title to find the book.
   
   
   The book is titled How to Make Money in the Stock Market-Buy 2,500 different stocks for $1000 - Pay no Commission. Easy to read packed with precise directions for success. A cookbook for the investor just follow directions. I enjoyed this book a great deal. It shows how indexing and diversification strategies work and why they are so important to investing success. Unlike many other books, this one is not only informative, but also useful. There should be no question as how to implement the author's strategy and measure your progress. He skillfully addresses asset allocation, and shows how to minimize tax consequences by assigning securities to tax deferred accounts. The author does not dwell on lengthy longwinded discussions but cuts to the quick with useful recommendation and directions for the novice and experienced investor as well. I recommend this book for all investors.Just click on the underlined title to go to the reviews of the book.The author answers all yiur questions by Email within 24 hours.How to Make Money in the Stock Market-Buy 2,500 Different Stocks-Pay no Commission



2. Ellis manages an active fund, which completely goes against the premise of his book. If he truley believes what he wrote, he would act accordingly. However, that isn't why I gave the book 2 stars. I gave the book 2 stars because it is basically a 2-3 page paper expanded to be a full book by using fillers. There is one simple concept, and it doesn't take an entire book to get across.



3. This book gives a further mesage than "buy an index fund". It gives the reader a pragmatic view of investing. The message should be this "Investor know yourself and the scenario where your playing, then act consecuently". Investing is a serious activity and should be taken seriously. Too many traps are set for those who take it as game and too many avoidable dissapointments take place. This book is a great book and a must read for anybody, particularly for those who want to invest their money. For those who may want further reading I would encourage them to read Wealth: Grow It, Protect It, Spend It, and Share It (Paperback) (Wharton School Publishing Paperbacks) and The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (Little Book Big Profits), they're both easy to read and will give you further knowledge of how seriously investing is.



4. An advanced look at how to invest in the markets. This is a must-read for all investors looking to get a deeper understanding of making money in stocks.



5. Ellis exposes the money managers who claim they can buy a security for you cheap, let it rise up, and then sell just before it drops. The real truth that Ellis lets us in on is that these people don't know anymore than anyone else, and what REALLY effects the markets are random events that nobody can predict. He also shows that the money managers really only make money buy churning transactions, no matter how high or low a security is. He returns us to finance 101 that tells us MARKETS are efficient, trying to time the market is not.

No comments about Poor Charlie's Almanack: The Wit and Wisdom of Charles T. Munger, Expanded Third Edition.

5 comments about The Little Book of Value Investing (Little Book, Big Profits).

1. the book is good as far as you need them only to review the basic principle of value investing. the author explain it well with examples. but you will be hard pressed trying to put these principles into practice



2. Don't let the small size of this book fool you! For anyone who is looking to build, over time, a valueable (read: multi-million dollar) portfolio of stock investments; this book might be all you would need. This book started a path for me that lead me to works by value-investing notable as Benjamin Graham, David Dodd, Mary Buffett, and more. After reading very famous texts by the above authors and more, I decided to revisit this work. I am floored by what Chris Browne presents here now I have a much more through understanding of the details.
   
   My advice is to BUY BOTH THE BOOK AND AUDIO-CD. Play the audio cd in your car or I-POD a few times to get the general idea. From there, take the text and follow the CD; highlight any ideas that grab you attention as well as any tips/techniques that he gives (particularly at the end of the book). You may not want to delve into the chapters on reading foreign financial statements--a little advanced for the beginner, I assure you!
   
   One you have a good understanding--get started. As I write this (02/2008), there are an abundance of good values in the market. I'm currently investigating a couple of wonder-investments as we speak. I argue this: anyone thinking of buying this book should buy it ASAP! As Chis Browne would say, there are too many stocks on sale....."...and you want to buy stocks when they are on sale".



3. The author states that over a long period of time value companies have outperformed the growth companies. You buy a value company when you pay less its intrinsic value (Buy Stocks On Sale). The key aspect of value investing is an ability to analyze financial statements of the company. The author explains, in the very friendly manner, such indicators of an intrinsic value like Operating Income, Current Assets vs Total Assets (and liabilities), Operating Margin, EBITD Margin, "Margin of Safety" and so on.
   
   The author declares that you can reduce the risk of loss in case of one stock's failure by building a diversified portfolio. However, when it comes to emerging markets, the authors suggest bewaring of them because of the frequent political disasters in particular countries. I do not agree with the author's advice of totally avoiding emerging markets. As an ETF of U.S. stocks like SPDR Trust (SPY) saves from one company's failure, an ETF that includes most of emerging countries, like iShares MSCI Emerging Markets Index (EEF) can save from a failure in one of the countries. Alternatively, you can build a portfolio of stocks in different emerging countries (as if you do this for U.S. stocks) by yourself without using an ETF or an index mutual fund.
   
   The author also proclaims that cognitive psychology explains why some investors make huge losses because of fear, panic, or following the crowd when it comes to hot sexy stocks. If you like the topic of how cognitive psychology affects investors, I can recommend "The Only Three Questions That Count: Investing by Knowing What Others Don't" by Kenneth L. Fisher.



4. Great book as an introduction to the principles of value investing as laid out by Benjamin Graham. Very easy to read. With about 140 pages, you can get through this book in a couple of hours.
   
   I'd use this as a warm up book to Intelligent Investor.



5. I learned from a broad range of investing books, and I got this one primarily because it was a short book. I'm only about half way through it, but I think it is very well written. It has some important information on how to approach researching a company. One of the glaring failures is how rapidly the trading environment can change. The book specifically tells investors to avoid China, and I've been making a lot of money investing in my first Chinese company. Read and learn, but ultimately decide for yourself on what you want to buy.

5 comments about Value Investing: From Graham to Buffett and Beyond (Wiley Finance).

1. Fantastic summary of modern value investing. Greenwald looks at the discipline with the critical eye of a professor, making it more informative than many other books about the subject. Even seasoned value investors will learn from this book.



2. The authors announce their intention to bravely go "beyond" Graham and Buffet. I found their effort extraordinarily interesting. Not because it brings new ideas from the frontiers of Value Investing; but rather because it forced me to revalidate old ones.
   
   Written mainly by academics, the book attempts - with undeniable clarity - to provide a simple framework for valuation of a firm using Value Investment principles. First, three sources of value are defined: Asset Value; Earnings Power Value; and Value of Growth. Second, some conceptual tricks are employed to link them in a theoretical structure capable of supporting hours of animated tutorial discussion.
   
   The importance of Asset Value in the scheme derives from the idea that if a firm that has no defenses against competitors it is worth no more, or less, than the replacement value of the assets necessary to set up a similar business.
   
   To illustrate, imagine a defenseless firm that is worth 2x on the stockmarket while its productive assets are worth only 1x. Attracted by the absence of barriers to entry and by the high market value achievable with a substantially lower investment, enterprising businessmen set up similar businesses.
   
   As the new capacity comes on stream the market is inundated with products of the same type and prices and profits consequently fall. The process only ends when the market value of all the firms has fallen to the value of their assets, thus eliminating the differential that attracted new market entrants in the first place.
   
   For this to happen we must have an idealized market of perfect competition: lots of buyers and sellers, undifferentiated products, no barriers to entry, perfect information, etc. In practice, however, a dozen firms with similar assets will generate a dozen different levels of profit. And in the end, as the book admits, it is profit expectations, not assets, that determine the value of an on-going business.
   
   I wondered if Graham and his associates ever subscribed to this concept. In my 5th edition of "Security Analysis" I found the ambiguous comment: "ECONOMISTS believe that high returns on capital attract competition which ultimately forces down the rate of profit" (my capitalization). This same edition affirms that it is "The earning power of the assets in use (that) determines their investment value" (rather than the replacement value of these assets). I could find no evidence that the notion formed a key part of the valuation process described in the value-investing classic.
   
   Moving on, We are told that the major difference between Earnings Power Value and Value of Growth, when used to estimate intrinsic value, is the confidence we can place on the result. It is notable, however, that both definitions of value exist in the same continuum. To calculate Earnings Power Value we can simply assume growth to be zero in the traditional Discounted Cashflow formula for estimating intrinsic value.
   
   Beyond a certain point it is reasonable to suppose that the degree of confidence we can put on an intrinsic value calculation falls with the size of profit growth projected. How much faith would we have in a value based on a growth projection of 30% per annum, for example? But why should zero growth produce an intrinsic value closer to the truth than 5% per annum? Is one really inherently safer than the other? What about the risk of deceleration in the case of an assumption of zero growth? Conservatism does not mean ignoring reality.
   
   Once again it all seems part of a jolly academic game. The questionable differentiation between Earnings Power Value and Value of Growth allows the authors to find a role for another element: the franchise - the defenses the firm possesses against competition. They thus arrive at a tidy little conceptual framework. If a firm has no franchise then its intrinsic value is represented by its Asset Value. If the franchise is weak then we base our estimate on its Earnings Power Value. And if it has a rock-solid franchise we might just be able to introduce the Value of Growth. Does all this have any useful meaning in the real world?
   
   Aside from these conceptual questions I found the book exceptionally practical in describing the details of how to value the assets and evaluate the franchise of a firm. On the other hand I found the profiles of eight value investors rather tedious.



3. While reading Graham himself is invaluable, this book is an excellent contribution to the field of value investing in its own right, and brings modern techniques that have been employed in this field for finding value. In addition, the author does an excellent job at qualifying Graham's valuation techniques over DCF valuation. Value investors do not disagree with DCF in principle, but its reliability, based on countless assumptions may not produce consistent results that align a firm's current reality and strategy with its intrinsic value. The latter part of the book discusses techniques of well known value investors and innovations to the field that they have brought to the table. Gabelli's private market value and control premium concept, as well as Seth Klarman's theme of looking for forced sellers are some of the highlights in this section.



4. I got this book from Amazon several years ago, have read it several times and applied it to my own investing. It is not for beginners, but does not require a Phd either. The authors present a rational philosophy and a unique, detailed method that will help you to really estimate the intrinsic value of a share of stock, and then they walk you through actual examples. The writing is interesting, concise, well organized, and clear. The book provides a backgroud of traditional value investing methods, and then introduces a model which builds upon and advances the body of value investing knowledge. I have read many books on value investing, and this is probably the best. Some of the material is difficult, but even if you don't get everything you will still profit from the book and find it interesting and thought provoking. The second half of the book, from Chapter 9 to the end, profiles various professional value investors, their philosophies and methods. This part of the book was probably included mostly to provide filler, but it is easy reading and contains some useful information.



5. This book is not about value investing, it is about modern security analysis, which is exactly what Graham warned against. It places an emphasis on growth over actual value. One of Graham's fundamental principles was that future growth is completely unreliable and any analysis based on it is just a speculator's way of justifying his gamble. While I liked the book's coverage on franchises and competitive advantage it highlights the fact that fundamentals weren't discussed at all.
   
   Here is the biggest example of why this book is so far off the mark. It highlights Intel as a value investment. The stock currently has a P/E of 25x and has always been over priced from a valuation standpoint. Not only that but Intel's only possible competitive advantage is size. Yes modern value investors look for good companies with long term competitive advantage but not at a high cost. Buffett was famous for sitting out the dotcom boom because they were not value investments.
   
   The only reason this book was not a one star book were the biographies of value investors in the second half of the book.

5 comments about Security Analysis: The Classic 1951 Edition.

1. Want to get started investing the right way, start with the basics and build a foundation. Started investing as of Jan '08, it's now March '08 and I gotta tell you, there's no rush in investing by skimming thru this book. Sit down, relax and educate yourself. It's a good start and it's the right start. I'll keep you all posted on my investment progress. Aloha!



2. This book is rightly considered the true bible of stock analysis, and is famous also for being how Warren Buffet approaches investing, as Graham was Buffet's own teacher.
   
   The book has extensive chapters dealing with every topic useful to the subject of stocks, from reading financial statements (one of the things that almost all amateurs could probably be better at, including myself), to assessing the company's true value, breakup value, etc. As one writer here already said, this is no easy path to riches, since this is a true discipline that takes a lot of work, but it can be done.
   
   However, late in his life, Graham was interviewed and said that his views had changed, and made a very important statement at the time. He said that for many decades, exhaustive methods of stock analysis had been profitable, but that was no longer the case. One must remember that the goal of his method is often not so much for determining the true value of a stock to be bought as an investment, so much as whether it should be liquidated, and the parts sold off, which are worth more individually than the company itself.
   
   In other words, the parts are worth more than the whole, and his method was a profitable way to assess likely candidates for this process. If I remember right, Graham himself was involved at least once in regard to a certain company as an activist investor who successfully pressured management to accept a buy-out or liquidate the company.
   
   In fact, at the time of the interview, Graham said that "He was no longer a proponent of detailed methods of stock analysis." He said that there had been a time when that was quite profitable, but that times had changed, and he now favored a cash-flow oriented approach. This method has many adherents now, and Standard and Poors, for example, is known today for using a proprietary cash-flow analysis. Basically, the true value of a company, and therefore its stock, is essentially the present discounted value of all future cash flows.
   
   That having been said, I still learned a lot from this book, and it has probably never been equalled as a rigorous text on the skills to do true stock evaluation and value-style investing.



3. I had to put this book down after skipping pages, sections, chapters, etc due to the academic writing style (way too wordy) and the vague examples/formulas. Like another reviewer I'd suggest that someone take all of the information in this book and boil it down to something easily readable with concrete examples. I've read tons of investing and educational texts and was bored to tears with this one but gave it 3 stars as I think there are some good nuggets buried in it. My most recent investing book was Rule #1 and it seemed like a very simplied version but an easy, understandable read, so maybe I'll wait for the Cliff Notes ;) I'm a trader/investor and don't need one on my shelf to "appear" smart...anyone want to buy my copy of this book?!



4. This is the a must read for any investors. It is, however, quite difficult for beginners to comprehend, though. At least I didn't understand it quite well until after I took Corporate Finance, Accounting, etc... and studied for my CFA exam.
   
   I'd recommend beginners read Graham's "The Intelligent Investor", which help create a concrete basis of your investment philosophy.



5. While the fly on this text touts the fact that this edition is photocopied from the original text, the process did not work. The text copy is fuzzy and blurred making it hard to read. This process was not disclosed in the Amazon summaries available for purchase decision which I find troubling. I would not recommend this text.

5 comments about The Warren Buffett Way, Second Edition.

1. Possibly the best Buffet book ever written. If you only have two investment books, this should be one and the Intelligent Investor the second. Mr. Hagstrom covers several famous Buffet transaction's. The basis of Buffet's investment philosophies and several relatively easy examples of how to judge a company. A novice book but a fun read for experienced professionals.



2. es uno de los peores libros que he leido, no esta ni cerca de ser interesante, de hecho lei 10 libros desde que empece a leer este y aun no lo termino. Si necesitan saber algo mas de Warren busquen otras opciones.



3. Warren Buffet, the world's richest man, without a doubt, is the greatest investor today. Buffet's the only investor using fundamental analysis who can beat market indices. Unlike the vast majority of money and mutual fund managers who charge high management fees and consistently lag their respective market indices, Buffet has beaten the market for decades. The one lesson this wise investor imparts is to invest in only what you understand. By following this discipline, Buffet bypassed nascent companies such as Microsoft, as well as, the dot.com mania in 1999 and 2000. This is when the RMC Q Trader [...] makes sense, picking up where Buffet and fundamental analysis stops. With a Q Trader program you benefit from diversified investment techniques.



4. I ordered this book and never got it. I inquired about not getting it twice. I think I got bored with chasing it down after that.



5. 
   
   I think it is a very good book to understand how the guys thinks about the whole game of investing. You can clearly see the signs of a seasoned investor throughout the book. But how much useful will it be for people like you and me, that's questionable. Imagine if Tiger Woods tells you how he plays golf or Mozart tells you how he composed those lyrics. It is kind of that. I think it is just a knack of things that either you have or you don't have. But do read the book just to get some idea about the financial market and its potholes that you need to be aware of.

1 comments about The Essays of Warren Buffett: Lessons for Corporate America, Second Edition.

1. This is the new edition of the classic original The Essays of Warren Buffett: Lessons for Corporate America, making its debut at Berkshire's 2008 Annual Meeting. I just skimmed this one and it is even more amazing than the original (which, as the reviews over there show, is also awesome).

5 comments about The Essays of Warren Buffett : Lessons for Corporate America.

1. this book realy gives insight into investing and into warren buffets mind. A great gift for yourself or others.



2. This collection is awesome, as every serious investor knows by now. Cunningham and Buffett just published a new edition in May 2008, The Essays of Warren Buffett: Lessons for Corporate America, Second Edition, which made its debut at the Berkshire Annual Meeting today. I've just skimmed through this "second edition," which is also on amazon at the foregoing link, and it is even more amazing! Fans will want to have copies of each in their libraries. The collections are the only complete statement of Buffett's business and investment philosophy--as he has explained it. They are expertly assembled by Cunningham.



3. I recently readed Buffet's biography where I firstly get a glance on his investment philosophy. Then I read this essays extracted from his Berkshire's annual reports to the shareholders and was delighted to find such a refreshing view on investment and business economics. His approach is simple and he share his views on common terms that an average person will understand.



4. What can I say except for the book is by god himself. It is an easy and interesting read. highly recommended to all those who want to get an idea on how to invest in stocks successfully!



5. The best book on investment ever. Had a lot of humour as well as a great education on investments. Very simple, easy to read and understand. It is also a combination of Fisher and Benjamin Graham.

5 comments about The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition).

1. This book has some great chapters that can be used to create a good stock screen to purchase value stocks. One point in this book that I found very valuable is this: No matter if you are in a bull market or not always keep at least 30% of your funds in cash or bonds. This at least saves some of your cash if the market turns around and heads lower. Think of the Nov 2007 to March 2008 downturn. Many people fully invested in at least stock founds in 401ks (that did not sell) lost up to 20%. How long will it take the old "buy and hold" to recover from that?
   
   [...]



2. I have been reading the intelligent investor for a couple of days now and just finished chapter 4. The book can seem a bit long but it is not. The arguments are easy to understand and comprehend. Graham argues that investment, as great as it could be, also contains significant risks and for long periods of times have not outperformed bonds when considering inflation. He thinks every intelligent person should have no more that 75% in equities in best of times and should have up to 75% in bonds in bad times. It is definitely a book worth reading not only because he reaches sensible conclusions and warns you not to blindly follow pundits but simply because it gives you overview on market performance by analyzing the historical data that should be mandatory knowledge for everyone serious about investing.



3. Having being for some time a small investor with mixed results I was trying to learn more about the dynamics of the stock market. Benjamim Graham makes an excellent case for value investing which distinguishes true investors from speculators. It is as actual today (if not more then) as it was first written several decades ago. If you only read one book about stocks, be sure you pick this one. Highly recommended!



4. Whether you are an investor or speculator, this book provides more detailed information than any book I have read. To get the most from this book, one must be willing to devote time to absorb what the author is writing about. As it is a rather large book, it is easy to put aside; however if one is serious about the "market" the vital information is available in this book. I firmly believe if one will read and understand this information, your financial program will benefit. Sam Harris



5. Simple like that: if you are a layman investor and don't want to lose a dime, stop your investment actions right now and start reading this book immediately.
   
   I've started composing my stock portfolio a couple of months, before reading this book. At that time, I didn't know any of the Graham's wise lessons and took many decisions, some Graham-complying ones and some not. After six months, all bets on companies in a strong financial position, with a dividend payment history of more than 20 years, offering shares with a discount as consequence of the market fluctuation, and so on, proved to be right, even during crisis time.
   
   A must read book for anyone aspiring to be a fraction of what a true investor is.