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By: Sam Instone

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November 7th, 2018

7 brilliant investment books (that are surprisingly underrated)

Financial Education

I’m often asked for a list of recommended reads.

I try to keep the more famous ones off the list…

As these appear in any simple online search.

Instead here are 7 underdogs…

And why I believe you should add them to your collection.

#1 The Money Game by Adam Smith

The reviews speak for themselves.

“The best book there is about the stock market and all that goes with it.”

– The New York Times

“This is a modern classic.”

– Paul A. Samuelson, First American Nobel Prize Winner in Economics

Yet this 1967 read rarely makes it onto blogs and lists.

The Money Game

I know you might be thinking that a book this old is outdated…

But you’d be wrong.

It proves that the world of investing remains relatively unchanged.

Inside, the stories, anecdotes and quotes really put things into perspective.

Adam Smith also happens to be one of the best financial writers I’ve ever come across.

His observations are excellent.

#2 Bull: A History of the Boom and Bust, 1982-2004 by Maggie Mahar

I personally find historical accounts fascinating.

There’s so much to learn from the past.

Bull A History of the Boom and Bust

This is a fantastic look into the bull markets of the 1980s and 90s.

It puts into perspective, what it must have been like for investors during these runs…

And why it wasn’t as easy for them as one may assume.

The book was also recommended to Berkshire Hathaway’s investors…

By Warren Buffett himself.

If it’s good enough for one of the world’s greatest investors…

It’s certainly good enough for me.

#3 What I Learned Losing One Million Dollars by Jim Paul & Brendan Moynihan

Stories of success are great motivators.

But stories of failure provide helpful and more realistic insights.

What I Learned Losing One Million Dollars

You can learn how to avoid or fix important mistakes.

This book tells the story of an investor who lost it all…

His fortune…

Reputation…

And job…

Due to excessive spending.

There’s an obvious emotional angle to it as well…

As Paul and Moynihan put it:

“Emotions are neither good nor bad; they simply are. They cannot be avoided.”

#4 The Investor’s Manifesto by William Bernstein

Bernstein’s book The Four Pillars of Investing is his most well-known piece.

But The Investor’s Manifesto is just as good.

The Investor’s Manifesto by William Bernstein

He has a fascinating ability to get you to think differently.

Like his idea on saving:

“Each dollar you do not save at 25 will mean two inflation-adjusted dollars that you will need to save if you start at age 35, four if you begin at 45, and eight if you start at 55. Since a 25-year-old should be saving at least 10% of his or her salary, this means that a 45-year-old will need to save nearly half of his or her salary.”

Now that’s food for thought.

#5 The Little Book of Behavioural Investing by James Montier

Just a little over 200 pages, this book can easily be read over a weekend.

The Little Book of Behavioural Investing by James Montier

It’s succinct but one of the best behavioural finance books I’ve ever read.

In it, you’ll learn some of the most frequently encountered investment biases and emotions

And how to overcome them.

Montier also shows no mercy for Wall Street.

His tongue-in-cheek writing is a humorous wrapper for the real stock-broker truths we all know…

And that some don’t like to admit.

#6 More Money than God by Sebastian Mallaby

Part market-history lesson, part history of hedge funds and part profiles of some of the world’s greatest investors….

More Money than God by Sebastian Mallaby

This book reveals the wealthy, powerful and potentially dangerous lives of some hedge fund moguls.

Mallaby, an esteemed financial writer…

Shows how they epitomised 21st-century capitalism.

I’ve read this book multiple times because it’s that good.

The research and stories are gripping…

Even after multiple reads.

 #7 Inside the Investor’s Brain by Richard Peterson

This is one of my favourite behavioural psychology books about investing.

Inside the Investor’s Brain by Richard Peterson

I especially love psychologist Richard Peterson’s five principles of fear.

As investors, we’re prone to fear and panic when the markets change.

Understanding how our minds and bodies work as investors…

Are key to developing awareness and, ultimately, long-term success.

Peterson’s passion for science and evidence is clear…

It’s no wonder I loved this book.

And I think you will too.

Continuous learning and successful investing go hand in hand.

Education allows us to make more informed decisions.

If you’re a lifelong learner like me, access our FREE Knowledge Library for financial insights and investment tips.

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About Sam Instone

Sam Instone, Director at AES International, is passionate about positive change and ensuring international investors get better results.

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