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Investment Books
- Expert Investors -

Books for expert investors, especially concerning technical analysis

 

These books are aimed at people who have a solid understanding of finance and/or trade for a living. There are quite a few on technical analysis for the "chartists" out there. Update 8/16/2006

  • Peter Bernstein (ed.)

    The Portable MBA in Investment


  • Warren E. Buffett and Lawrence A. Cunningham

    The Essays of Warren Buffett: Lessons for Corporate America top10 pick fidelity

    This book is a collection of annual report letters by legendary investor Warren E. Buffett to shareholders of Berkshire Hathaway, Inc., the holding company for which he serves as chairman and CEO. Buffett is widely regarded as one of the most successful investors of the 20th century. Reading this collection of shareholder letters, carefully arranged and edited by Lawrence A. Cunningham, is like taking a course from Buffett himself, as you learn the thoughts and theories behind his investing practices.
    In his shareholder essays, you won't find Buffett commenting much about the stocks he owns, but he loves to discuss the basic principles behind his investments. Many of his principles are derived from his study at Columbia University, where he learned — and later worked — under the tutelage of professor Benjamin Graham (The Intelligent Investor, Security Analysis).
    Buffet's folksy writing style has made his letters among the most widely read financial documents on Wall Street each year. In his company's 1989 report, Buffett wrote:
    "We hope to buy more businesses that are similar to the ones we have, and we can use some help. If you have a business that fits the following criteria, call me or, preferably, write. Here's what we're looking for:
    (1) Large purchases (at least $10 million of after-tax earnings),
    (2) demonstrated consistent earning power (future projections are of little interest to us, nor are "turnaround" situations),
    (3) businesses earning good returns on equity while employing little or no debt,
    (4) management in place (we can't supply it),
    (5) simple businesses (if there's lots of technology, we won't understand it),
    (6) an offering price (we don't want to waste our time or that of the seller by talking, even preliminarily, about a transaction when price is unknown).
    "We will not engage in unfriendly takeovers. We can promise complete confidentiality and a very fast answer — customarily within five minutes — as to whether we're interested. We prefer to buy for cash, but will consider issuing stock when we receive as much in intrinsic business value as we give."
    Buffett is not immune to owning up to poor investing results, either. Witness this commentary from 1999's annual report letter:
    "Even Inspector Clouseau could find last year's guilty party: your Chairman. My performance reminds me of the quarterback whose report card showed four Fs and a D but who nonetheless had an understanding coach. 'Son,' he drawled, 'I think you're spending too much time on that one subject.' My 'one subject' is capital allocation, and my grade for 1999 most assuredly is a D. What most hurt us during the year was the inferior performance of Berkshire's equity portfolio — and responsibility for that portfolio, leaving aside the small piece of it run by Lou Simpson of GEICO, is entirely mine."

  • John F. Carter

    Mastering the Trade fidelity chk

  • Tushar S. Chande and Stanley Kroll

    The New Technical Trader: Boost Your Profit by Plugging into the
    Latest Indicators


  • Robert W. Colby and Thomas A. Meyers

    Encyclopedia of Technical Market Indicators
  • Robert D. Edwards and John Magee

    Technical Analysis of Stock Trends
    top10 pick fidelity

    Many traders who use technical analysis mentioned the Edwards and Magee book as "the bible of technical analysis." The book claims to be "the first to produce a methodology for interpreting and profiting from the predictable behavior of investors and markets." What traders feel strongly about is that this book shows them how to use technical analysis to make money trading regardless of market conditions. It thoroughly explains all of the key technical trading concepts, including chart patterns, relative strength, candlesticks, oscillators, momentum and volume, moving averages, and other indicators. In addition, the authors explain how to spot trends through the use of these technical indicators.
    Professional trader Kornstein explains why he feels the Edwards and Magee book is so essential. "Basically, technical analysis is graphing the changes in price, time, and volume, and the mathematical derivatives that are formulated from this data," he says. "The concepts taught in this book are as useful today as they were fifty or sixty years ago."
    For a less-intensive understanding of technical analysis, Kornstein recommends Martin J. Pring's book Technical Analysis Explained. Pring covers the technical indicators of the markets by explaining the concepts in simple, easy-to-understand language.

  • Alexander Elder

    Trading for a Living: Psychology, Trading Tactics, Money Management top10 pick fidelity
    Dr. Elder, a trader and psychiatrist, was one of the first traders to recognize the importance of the emotional aspects of trading. He pointed out that a superb trading system with a poor psychological profile often leads to an unprofitable portfolio.
    "Elder focused on giving first-time traders their own trading plan so that you not only knew where to start, but you also had a good formula for managing risk," says Deron Wagner, president of Morpheus Trading Group. "It was the first book I read after I got into trading and it helped me get my feet wet."

    Wagner says that the sections of the book that deal with psychology and risk management are "must reads."
    On a personal note: Every time I discuss trading with Dr. Elder, I gain additional insight about what really goes on behind the scenes in the stock market. And that's the essence of his book: It reflects his knowledge and understanding of what makes markets move up or down. Elder followed his first best-selling book with another, Come Into My Trading Room.

  • Alan S. Farley

    The Master Swing Trader
    fidelity chk

  • George A. Fontanills

    The Stock Market Course
    fidelity chk
  • Marc Friedfertig and George West

    The Electronic Day Trader

     

     

  • A. J. Frost, Robert J. Prechter, and Robert R. Prechter

    Elliott Wave Principle: Key to Market Behavior

     

     

  • Benjamin Graham and David L. Dodd fidelity

    Security Analysis


  • Benjamin Graham

    The Intelligent Investor
    top10 fidelity chk

    This best-selling book, originally published in 1949, is often referred to as the definitive work of fundamental analysis. College professor Benjamin Graham is considered by many to be the world's greatest investment advisor of the 20th century because he introduced a generation of investors to a strategy called "value investing." From an early age, Graham learned the importance of thoroughly researching a company and determining whether its stock price was a good value.
    Graham's book can be useful to both investors and traders, according to several professionals in both camps. Consider what independent trader Howard Kornstein says: "Traders should read and study this book. Although The Intelligent Investor was written more than 50 years ago, it is not outdated. The fundamentals of the securities marketplace have not changed. If you're going to take a long position, it benefits you to choose a company that is fundamentally stable. By reading this book, you learn to identify companies that are fundamentally sound and in position for a possible trade. Anyone who trades a company that is not fundamentally stable is likely to execute a trade that could result in a significant loss." Kornstein said he chooses trades using a combination of charts and fundamental valuation.
    Although the original version of this book was found to be a difficult read for some novice traders or investors, the terminology of the latest version is markedly improved. Another highly respected Graham book — Security Analysis (originally published in 1934 with co-author David Dodd) — is considered a dietary staple for those considering a career in portfolio management.

  • Joel Greenblatt

    You Can Be a Stock Market Genius fidelity chk

    The Little Book That Beats the Market fidelity chk

  • Robert G. Hagstrom; foreword by Peter Lynch

    The Warren Buffett Way fidelity chk

  • Jeffrey A. Hirsch and Yale Hirsch

    Stock Trader's Almanac top10 pick fidelity

    The Stock Trader's Almanac is a reference book that many traders believe is a requirement for any serious trader. This almanac includes several graphs, historical charts, market data, forecasts, economic announcements, and a calendar of events, among other information. Although not 100 percent accurate in its recommendations, the book will give insight on historical market events and performance, and provide forecasts as to when the authors believe similar scenarios could occur in the future. In addition, the almanac will help identify specific trends that take place on a yearly or cyclical basis. For example, the book notes that the market tends to have higher trading volume during the first three weeks of a new calendar year. The authors also assess the probability of whether or not a similar trend could take place the following year.

  • John C. Hull

    Options, Futures, and Other Derivatives

     

     

  • Jonathan E. Ingersoll

    Theory of Financial Decision Making

     

     

  • R. A. Jarrow

    Modelling Fixed Income Securities and Interest Rate Options

     

     

  • William L. Jiler

    How Charts Can Help You in the Stock Market

     

     

  • Jeffrey Katz and Donna L. McCormick

    The Encyclopedia of Trading Strategies


  • Ari Kiev M.D.

    Trading to Win fidelity chk

  • Charles Lebeau and David W. Lucas

    Technical Traders Guide to Computer Analysis of the Futures
    Market'


  • Roger Lowenstein

    Buffett: The Making of an American Capitalistfidelity chk

    When Genius Failed fidelity chk

  • Marcel Link

    High Probability Trading fidelity chk

  • Peter Lynch (with John Rothchild)

    One Up on Wall Street top10 fidelity chk

    Portfolio manager Peter Lynch led Fidelity Magellan Fund to a 28-fold per share gain from May 1977 to May 1990, and is recognized as the most successful mutual fund manager of this generation. When he wrote One Up on Wall Street, in 1989, an increasingly larger percentage of the U.S. population was investing in the equity market, but many newcomers had little knowledge about how to buy and sell stocks.
    "My objective in writing the book was to communicate many of the basic investing principles I adopted over the years," Lynch points out. "I felt it might help those people willing to put in the time and do the research work necessary to become a better investor."
    One of Lynch's key messages was to understand the companies issuing their stock. With his friendly writing style, he explained in his book that investors could identify profitable companies based on their own experience and observations. For example, a person who worked in a shopping mall during his or her career might have an edge in the retail sector, just by watching which stores were busy and which products were big sellers. The person working at the mall could have seen a lot of good ideas just by observing consumers and talking with them. This kind of company observation helped generate several good stock ideas for Lynch in his term running Fidelity Magellan, and he would follow up on those ideas with rigorous fundamental research.
    "For new investors, Lynch teaches you how to use what you already know to make money in the market," wrote author and former portfolio manager Joshua Kennon, who included Lynch's book in his own top-10 list on About.com.
    Another important lesson Lynch sought to pass along to readers was that investing was serious business. He pointed out that many people spent more hours researching a new television set purchase than investing $20,000 in a stock based simply on a tip they heard from a neighbor.

    Beating the Street fidelity chk

  • Charles Mackay fidelity chk

    Extraordinary Popular Delusions and the Madness of Crowds

  • John F. Magee

    Analyzing Bar Charts for Profit

     

     

  • Lawrence G. McMillan fidelity

    Options as a Strategic Investment

     

     

  • Robert Merton

    Continuous Time Finance

     

     

  • John J. Murphy

    Technical Analysis of the Futures Markets

     

     

  • John J. Murphy

    Study Guide for Technical Analysis of the Futures Markets:
    A Self-Training Manual

    Technical Analysis top10 pick fidelity chk

    Technical Analysis of the Financial Markets guides you from the first application of Dow Theory and the basics of charting through the latest computer technology and most advanced analysis systems. Written by StockCharts.com's John Murphy, a former director of Merrill Lynch's technical analysis futures division, this book includes 400 charts that clarify key points of the following: candlestick charting, point-and-figure charting, oscillators, Elliot Wave Theory, Fibonacci, and other technical indicators.
    Gail M. Dudack, chief investment strategist for Warburg Dillon Read, provided the following testimonial to Murphy's book: "No one in this generation had contributed more to technical analysis than John Murphy. Through his series of books, he has opened the door to many and raised the standard for all who use technical analysis. His books should be required reading for everyone in the securities business and are never more than a step away from my desk."

  • Sheldon Natenberg

    Option Volatility and Pricing: Advanced Trading Strategies and
    Techniques


  • Steve Nison

    Japanese Candlestick Charting Techniques fidelity chk

  • Robert Pardo

    Design, Testing, and Optimization of Trading Systems


  • Martin J. Pring

    Technical Analysis Explained fidelity chk

  • William J. O'Neil

    How to Make Money in Stocks
    top10 pick fidelity chk

    William O'Neil, publisher of the popular financial newspaper Investor's Business Daily, was one of the first investors to clearly explain how to select profitable stocks using both fundamental and technical analysis. In his best-selling book How to Make Money in Stocks, originally published in 1988, he introduced traders and investors to his rule-based, common-sense trading approach — CAN SLIM.TM The acronym CAN SLIM stands for: Current quarterly earnings per share, Annual earnings per share, New products, Shares outstanding, Leaders, Institutional sponsorship, and Market direction.
    "What's so great about this book is that O'Neil takes the best strategies and combines them into one technique, CAN SLIM," says Morpheus Trading Group's Wagner. "He also gives specific rules that you can use when entering a position. Most important, he tries to keep you from buying stocks that will fall apart, and he does that by teaching you how to find quality stocks by combining fundamental and technical analysis." Wagner adds that 80%-90% of the stocks that he buys are based on a modified version of O'Neil's system.
    During a previous interview I had with O'Neil, he explained how he first used CAN SLIM to turn a small amount of money into a fortune. With his profits, he started his financial newspaper based on the successful theories included in his book.

  • Robert R. Prechter and R. N. Elliott

    R. N. Elliott's Masterworks: The Definitive Collection

     

     

  • Martin J. Pring

    Martin Pring's Introduction to Technical Analysis

     

     

  • Martin J. Pring

    Technical Analysis Explained

     

     

  • Peter Ritchken

    Options: Theory, Strategy, and Applications

     

     

  • Robert P. Rotella

    The Elements of Successful Trading


  • Jack D. Schwager

    The Market Wizards
    & The New Market Wizards top10 pick fidelity
    These two complementary books are often mentioned as classics primarily because of the author's probing question-and-answer techniques. In these books, Schwager delves into the minds of some of the country's most successful traders to unlock the wisdom behind their profitable trading techniques.
    Author Turner says the Schwager books are her favorites. "From these financial superstars, we discover not only terrific insight into the workings of the financial markets machine, we learn that along with their victories, these traders have experienced losses that were, at times, devastating. Yet, they emerged stronger and with renewed conviction that they could succeed in one of the world's most challenging arenas. These two books remain timeless, compelling, and always present me with new nuggets of wisdom."