Recommended Reading

Here I give you a list of some of the most influential books in my trading career.  I've read all of these at least once, and they represent what I would recommend to a friend.  The list is not comprehensive, of course, but it should get you started if you are new to investing.  If you are experienced, there may be a few names here worth your investigation for further study.  Photos link to sites for the book.
 

GENERAL INVESTING

The Only 3 Questions That Count, Ken Fisher
I normally don't read the latest "Get Rich by Investing" books that come out every year in the business section.  I'll admit, that's what I thought this was before I read the jacket.  I read it on vacation this year, and found Mr. Fisher to be a Contrarian's contrarian.  He debunks several myths that we all take for granted (e.g. the federal deficit is bad for stocks and the economy).  Very eye-opening, and most importantly, it re-inforces the need to think outside of your comfort zone when making investment decisions. 
 
The Intelligent Investor, Benjamin Graham (with commentary by Jason Zweig)
I read the original work when I first started trading, and didn't understand much of anything.  A few years later, I picked up this copy to take on my travels, and thoroughly enjoyed it.  It is the same text as Graham's original, with dot.com-era commentary added by Jason Zweig.  Admittedly, the dot com bust was obvious in hindsight, and I remember several "value investor" books hitting the shelves at that time.  Nonetheless, Grahams master piece with Zwieg's additions are good reminders that no matter what part of the business cycle we are in, security valuation needs to be respected.
 
 
An Empire of Wealth, John Steele Gordon
There are many "History of Wall Street" books out there, but I like Gordon's take.  His detailed verse situates the stock market as the centerpiece of US History itself.  Politics, scandals and heartbreak all share the stage within the context of a growing nation struggling to maintain order. 

Barron's Business Review Series
Good for home-schoolers, like me.  Good coverage of business topics with plenty of test questions and included answers.


Exam Cram Series 7 Securities and Licensing Exam
Dry, straight-forward study course on all things related to the securities industry.  Good stuff to know when sitting down with your Financial Advisor.

Product Details
The Secrets of Economic Indicators, Bernard Baumohl
Keep up with the economy by understanding the plethora of data and statistics released regularly by the Federal Government and other sources.  Provides market sensitivity and likely reaction scenarios, release dates and times, as well as links to the release page which generally includes historical data as well.  There are several websites that also describe the indicators, but this book is useful because of the depth of explanation and thorough coverage of all important releases. 
 
 


STOCKS
Fundamental Analysis: A Back-To-The-Basics Investment Guide to Selecting Quality Stocks
Fundamental Analysis, John C. Ritchie
The first book on fundamental analysis I ever read.  Didn't understand much of it until the 3rd reading.  That is no reflection on the author or writing style, however.  Once the material sunk in, I found it an invaluable reference on evaluating balance sheets and income statements.  Special sections on analyzing Utilities, Tranports, and Financial Industries. 
 
Encyclopedia of Chart Patterns, Thomas Bulkowski
Complete reference for all chart patterns know to humans.  The statistics compiled by Mr. Bulkowski may seem like overkill, but in practical use, they are an excellent decision-making tool.  Lot's of examples and discussion with actual charts, this is another reference I keep on my desk.  For more on Thomas' work, see his website.

How to Make Money In Stocks, William O'Neil
Not a get rich quick book at all, O'Neil lays out his CANSLIM method of stock selection.  This method is the basis behind the successful newspaper Investor's Business Daily, which I used to read.  The high-level lesson of the book is that there are 7 basic things to look for in selecting stocks.  They include:  consistent earnings and revenue growth, a niche market, low supply of shares (low float, for high demand), etc.  The general approach is sound, and works best in bull markets.  This book is suited to the non-professional investor, in my opinion, because it presents a buy and hold strategy for selecting worthwhile stocks.
 
 24 Essential Lessons for Investment Success, William O'Neil
A short, Q&A style book that covers everything from finding candidates to timing your entries. 
 
One Up on Wall Street, Peter Lynch
The classic work from one of the best mutual fund managers of all time.  I read this during my down time in 2001 while working for, you guessed it, Fidelity Investments, as a computer programmer.  Summary:  Invest in what you know.
 
Reminiscences of a Stock Operator, Edwin Lefevre
One of my all-time favorite books, this is a very light read.  It tracks the career of the fictional Larry Livingstone (based entirely on the real-life high-stakes market trader Jesse Livermore).  From bucket shops to broke, Livermore's real life was quite tragic.  Reminiscences focuses on the period from when he was a teenager starting out reading tickers as a chalk board boy, until he solidified his reputation as the great bear of wall street during the 1929 crash.
 
Market Wizards and New Market Wizards, Jack Schwager
Interviews with successful traders from commodities and forex to stocks and bonds.  The common theme that inspired me during my early years was that each subject admitted to some sort of failure early on in their careers.  What made them successful was that they didn't give up, but faced the music head on and course-corrected what they needed to.  Easy read, and still applicable 10 years since I read them first.


 
OPTIONS

Option Volatility and Pricing, Sheldon Natenberg
Not cheap, but definitely worth the investment if you are an options trader.  Hardcore options information.  Lot's of math, and an excellent discussion of how to trade volatility.  The formulas and explanations in the Appendices helped me a lot in writing my own option pricing program.
 
Options as a Strategic Investment, 4th Edition, Lawrence McMillan
The bible for options traders.  It can be a bit daunting to read through the nearly 1,000 page tome, but it is worth it.  This seminal work covers all common strategies in detail, separating call strategies from put strategies.  The organization is clear, and continues to occupy space on my desktop bookshelf.  In February 2008, I attended one of Larry's seminars in New York, and found him to be extremely knowledgable in the field of options.  His approach is always to find an edge in his option trading.
 
McMillan On Options, 2nd Ed., Lawrence McMillan
After you've read Options as a Strategic Investment, this is your next options book.  In it, Larry discusses many practical ways to use options for your trading.  Using volume and other option statistics, there are ways you can give yourself an edge by looking where others aren't. 
 



TRADING

The Disciplined Trader, Mark Douglas
One the first trading books I read, I enjoyed the non-technical approach to mental readiness.  One of the concepts that has stuck with me was to imagine two people looking at the inside of a computer.  One is a computer expert, and the other knows nothing about computers.  They both are looking at the same hardware, but they see two different things.  The non-expert sees a bunch of wires, circuit boards, and metal.  The expert sees hard drives, mother board, memory, and understands how they all work together. 
 
The novice trader is like the non-expert, seeing the market without much meaning.  As you learn to trade, you become able to see the market like the computer expert:  understanding all the parts, knowing how they work together, and applying that knowledge for the better.
 
 
Trading for A Living, Dr. Alexander Elder
A broad-brush take on trading professionally.  While lacking many of the hard earned lessons we all suffer through, I read this book twice to really absorb it.  Lots of technical indicators explained, and a small section on money management.
 
I was fortunate enough to have dinner with Alex in 2004, and he is genuinely a nice person.  Thanks for the vodka, Alex.
 
Technical Analysis Explained, Martin Pring
I read the 3rd edition of this back when I first started.  A very comprehensive volume on all things related to chart reading, including volume, indicators, inter- and intra-market relationships, etc.  Excellent for beginners.
 
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