Book Description

" . . . quite simply the best financial self-help book." ... Read more

Reviews (59)

Excellent, easy to read introduction for managing finances.
Chilton's book is a must read for anyone over the age of 10.

Written as a novel, Roy the Barber takes clients through easy steps to create wealth. He discusses everything from the new Roth IRAs to home buying, mutual funds, compounding intereset, investment strategies and how to save money necessary for achieving financial wealth. His advice is practical, sound, and realistic.

Unlike most financial books, The Wealthy Barber is free from technical jargon, and encourages readers to take action now to be smarter about money issues.

Even seasoned financial wizards benefit by discovering better ways to explain finances to others.

Read it, and pass it on to your spouse, family, children and friends.

Get Rich Slowly, Steady, and with Sure Success
There are a lot of books on how to manage your money. Most are too thick, few leave a lasting impression and almost none of them are fun to read. One of the first exception is "The Wealthy Barber" by David Chilton. It is really fun. You read this book like a novel with a trouble putting it down. But by combining the common sense and humor this "novel" in its dialog style shows that sound financial planning is pretty simple stuff. And it actually makes personal money management understandable and attainable.

I believe, plenty of years from now "The Wealthy Barber" could be remembered by readers. And they could remember Mr. David Chilton not as best-selling author, but as the guy who inspired hundreds of thousands of people to save their way to prosperity. In fact, for many readers, "The Wealthy Barber" is possibly the only book they need. If ever a financial planning was written for those without any financial backgrounds, this is it - "The Wealthy Barber".

Well-balanced advice
If you cannot decide whether you should own or rent a place to live in, the barber discusses this issue very thoughtfully, and this discussion will help you make the better decision.

The barber does believe that it is possible to make money in stocks. If you have discipline and courage, he thinks you can actually buy low and sell high. The barber tells you to buy undervalued stocks and then sell them later for a higher price when the real value of the stock is recognized by the market. The author does warn you that you do have to be able to tell the difference between an undervalued stock and one that is unhealthy. This is tough to do. So it is not the barber's fault if you lose money because he leaves it there for you to figure out.

What about buying low and selling high in real estate? On page 178 Mr. Chilton writes that sometimes it is possible to "buy it [real estate] at any price, sell higher." But in other parts of the book he writes that real estate prices won't always keep going up.

The 10% solution is not enough, it won't get the job done for many readers. There are signs that inflation, after a long absence, is on the way back. It should be a 15% solution.

I deduct one star because the book does not have an index. I think an index is very useful, and adds value to a book. However, on page 44, after discussing all the pros and cons of owning versus renting, the author says that buying the condo was a good idea. I became so happy that the barber put the new condo owner on the right track, I gave him back the star.

All I have to say is get on with it!
I almost didn't make it through the first part of the book.
The first two chapters are a waste of time unless you are a Detroit sports fan. (And I live in Detroit)
The next two chapters talk about wills and life insurance and have some useful information if you don't know anything about either of these two areas.
Start on Chapter 6 for retirement
If you are already a home owner, invest in a 401k or some other type of IRA, and have some idea of what you do with your disposable income then skip this book.

IF YOU ARE JUST STARTING OUT, I must say this book has much more "real" concrete financial advice than a book like Rich Dad Poor Dad. If you had to pick between the two, select this one

The Wordy Barber
There are true gems in this book and even though they are buried in a lot of irrelevant drivel, they are there! Do not let the silly modern 'reader friendly' fad of making any topic "easier", ' idiot proof' and 'for dummies' by the use of a conversation that is utterly off putting and idiotic, stop you from gathering the gems of knowledge in this book. Rise beyond that and get the BENEFITS!

Unlike some recent popular drivel that masquerades as ' a road to financial freedom' etc, after you have read this book you have a detailed blue print that you can follow immediately and get yourself on tract to a secure financial future.

As I said.. wordy, so 4 stars. ... Read more

Book Description

Develop a Winning Investment Strategy -- with Expert Advice from "The Nation's #1 Money Manager"

Peter Lynch's "invest in what you know" strategy has made him a household name with investors both big and small.

An important key to investing, Lynch says, is to remember that stocks are not lottery tickets. There's a company behind every stock and a reason companies -- and their stocks -- perform the way they do. In this book, newly revised and updated for the paperback edition, Peter Lynch shows you how you can become an expert in a company and how you can build a profitable investment portfolio, based on your own experience and insights and on straightforward do-it-yourself research. There's no reason the individual investor can't match wits with the experts, and this book will show you how.

In Beating the Street, Lynch for the first time:

* Explains how to devise a mutual fund strategy
* Shows how he goes about picking stocks, step-by-step
* Describes how the individual investor can improve his or her investment performance to rival that of the experts of the investment clubs. ... Read more

Reviews (44)

Peter's Principles are great
They've has done it again, this book is very funny and filled with useful tips from seasoned investor Peter Lynch. This book has several of "Peter's Principles" (which are very humorous one-liners that make a lot of sense for investors.) My favorite parts of this book are: The story about the St. Agnes 7th grade portfolio managers (these kids beat out 99% of fund managers when they had a two year gain of 70%.) Another part of this book that I enjoy are the subtle tips for evaluating stocks. Mr. Lynch doesn't tell you to do this, that, and another thing to find the ten-baggers, but he does give clues throughout the text.

Reed Floren

Yet Another Mis-Leading Exhortation to Buy Stocks
This book, written in 1993, simultaneously comes at the end of Mr. Lynch's career in money management and the beginning of a long sprint in the broader stock market, largely fueled by tech/internet stocks. In any period, one can expect 1 of 100 money managers to far outperform both his or her peers and the broader market by chance. Mr. Lynch was that one money manager.

Mr. Lynch starts the book by turning investing into a game. Although his method was subtle (using an example of grammar school kids picking stocks), the implications are profound. Investing does share some resemblance to many games we play in life, and one of the Great Money Masters, the fictitious 'Adam Smith' readily admits this in his classic book on investment, The Money Game.

However, Mr. Lynch takes things one step beyond the game, and as the book's title hints, he turns all investment activities into a competition. In so doing, he pits the small investor against the institutional Players, and as a result, sets up the naive reader to walk a well-trodden path littered with sorrow and the bones of many foolish investors.

Granted, 'Adam Smith' once said, "The Players aren't smarter than you. They just have more information", and there also is a certain level of truth to Lynch's assertion that the Little Guy can outperform the Big Boys. However, Lynch fails to disclose one important and critical difference.

I believe it was Hemmingway who said, in response to Fitzgerald's observation that the rich were not like the ordinary schmuck, that "Yes, I know. They have more money." Something frightfully similar can be said of the key difference between the Little Guy and The Players, but with one critical insight: The Players do not merely have more money, they have a lot more of Other People's Money. That in essence is the fundamental difference between The Players and the Little Guy, who must wager his (or her) own hard-won funds in order to play the Grand Game- the stock market.

Needless to say (but will be said anyway), the consequences of one's actions weigh heavily on one's shoulders when one's own money is at stake, but really aren't felt when Other People's Money is on the line. The Players play with Other People's Money, but you, dear investor, play with your own hard-won earnings. That said, the intelligent investor must ask herself, 'Do I really want to play with my money?'.

Beating the Street rests heavily on this undisclosed truism and a host of faulty assumptions. The book really is a sales pitch to buy stocks and to participate as much as possible in stock mutual funds. To that end, Mr. Lynch places before the reader a number of questionable arguments. Here are just two:

First, perhaps the most flawed argument of the book is that the small investor, upon retirement, will spend more than she earns in investment income. This is stated as a bona-fide fact when in reality, it is a generous assumption. From this assumption, Mr. Lynch then argues that one should invest in stocks and use some portion of the capital appreciation in addition to the dividend income for the purpose of meeting one's spending needs. He then fortifies his argument by citing inflation and emphasizing its ability to erode fixed income.

The facts are 1) how much investment income you will need is determined by how much you plan to spend, 2) many people choose to work either part-time or full-time after retirement (either out of necessity or desire), and thus have some supplemental income, 3) though the general historical trend for stock prices has been 'up', there is nothing that says that stocks have to go up, and finally 4) inflation can adversely affect stock prices (and have actually done so in the past). Lynch invokes the inflation argument when trashing bonds, and abandons it when touting stocks, even though inflation acts on both. Nor does his idealized comparison of stocks vs. bonds on pages 52-56 take into account taxes and transaction costs incidentally.

Second, on page 69, Mr. Lynch boldly says that, "If you plan to to stick with a fund for several years, the 2-5 percent you paid to get in will prove insignificant". This last statement may actually be worse than his first (of many) flawed arguments, for the following reason: the money lost to the load fails to compound at whatever investment rate of return, and over long periods of time, the difference between what you committed and what gets actually invested grows- and this is before we even consider the effect of annual expenses.

These and other flawed but superficial arguments for stock investing make for very difficult reading. Apart from the gross argumentative errors, the book presents many of Mr. Lynch's reminiscences of a stock market long gone. However, there are some useful hints in the book, most likely put there by Mr. Rothchild, but they are far outnumbered and over-shadowed by Mr. Lynch's deceptive pitch to buy stocks.

Excellent
It's hard to find a better written book on investing that Beating the Street. Despite working in the industy for many years, Peter Lynch urges people to do it for themselves. He writes clearly giving examples of how one could do better than the Wall Street pros. This book is one of the best on investing that I have read.

Not Half Bad.
In my opinion, this book was a lot more readable than I would have expected a book about the stock market to be. The light humor (very light) kept the book interesting and there were plenty of good tips. The "20 Golden Rules" were great. Lynch obviously knows what he's doing and he proves it by giving real life examples from his own successful experience. The only setback I found was that the tips were made out to be really easy, but they sounded tough. Overall, though, I would recommend it to both beginners and pros involved in the stock market.

Learn from the Master
Lynch's success comes not from his complex algorithms and estoric financial modeling, but from opening his eyes to the world and noticing good businesses.

His success at Magellan is attributed to his ability to find good companies, at reasonable valuations, and be patient enough to watch them climb.

This book is much more specific than his other release. Here, he provides detailed accounts of stock picking strategy, including how to choose from different stocks, when to buy, when to buy more and when to sell.

This is a quick read, but there is a huge amount of information that the average investor can use to their benefit. ... Read more

Book Description

"Once I picked it up I did not put it down until I finished . . . What Schwed has done is capture fully—in deceptively clean language—the lunacy at the heart of the investment business."—From the Foreword by Michael Lewis, Bestselling author of Liar's Poker

This hilarious portrait of everyday Wall Street and its denizens rings as true today as it did when it was first published in 1940. Writing with a rare mixture of wry cynicism and bonhomie reminiscent of Mark Twain and H. L. Mencken, Fred Schwed, Jr., skewers everyone including himself in his brilliant send-ups of bankers, brokers, traders, investors, analysts, and hapless customers.

"How great to have a reissue of a hilarious classic that proves the more things change the more they stay the same. Only the names have been changed to protect the innocent." —Michael Bloomberg President, Bloomberg, LP

". . . one of the funniest books ever written about Wall Street."—Jane Bryant Quinn, The Washington Post

"It's amazing how well Schwed's book is holding up after 55 years. About the only thing that's changed on Wall Street is that computers have replaced pencils and graph paper. Otherwise, the basics are the same. The investor's need to believe somebody is matched by the financial advisor's need to make a nice living. If one of them has to be disappointed, it's bound to be the former."—John Rothchild, Author, A Fool and His Money Financial Columnist, Time magazine

"A delightful classic and reminder of excesses past and how little things change." —Bob Farrell, Senior Vice President, Merrill Lynch ... Read more

Reviews (21)

A Look at Wall Street Excess with Classic Humor
If Will Rogers and Mark Twain got together to write a book on the excesses of Wall Street, the outcome would have been this book. Having stood the test of time and now displayed as an investment classic, this book is a must read for anyone who works in finance.

The author does a great job of humorously outlining the excesses of Wall Street, the classic conflicts between bankers and their clients, and the fickle nature of the market. It is a very quick read with many anecdotes that are relevant to this day.

An Investment Classic All Stock Investors Should Read!
This book clearly deserves more than five stars for exposing the folly of Wall Street in the most humorous possible terms.

This book's fame far exceeds the number of people who have read it. Almost every experienced stock investor will cite examples from the book, without even knowing their source.

The title refers to an ancient story (which the author finds is probably at least 100 years old by now) about a visitor to New York who admired the yachts that the bankers and brokers had in the harbor. Naively, he then asked where the customers' yachts were. Naturally, there were no customers' yachts.

Let me set the stage. The author spent two years on Wall Street in the 20s, but knew it better than that and continued to invest in stocks. He wrote the book in 1940 after the horrible bear years of 1929-1940. The memories of the 1920s were still fresh. Then he updated the book in 1955 in the midst of the 50s bull market with a new introduction in which he explained that the book did not need updating.

Although commissions are no longer fixed, and few spend the day sitting in a broker's office, many of the other observations in the book remain as timely as those in The Madness of Crowds. Human nature doesn't change.

Behind all of the hype about getting rich with stock investments is a sad reality. Over a lifetime, the vast majority of people get poor results from their stock investing. Around 90 percent of professionals will also underperform the market averages over their careers.

But the desire to "outsmart" everyone else is almost universal. Raging bull markets, like the one we had until March 2000 on the NASDAQ, only tend to reinforce these ultimately expensive urges.

I have been around professional investors for over thirty years and all the big scores I remember involving stocks came after someone who was a founder or worked for a company that went public cashed in their stock and stock options after many years of service. These are not stock-investing events, they are entrepreneurial compensation. In the Money Game, Adam Smith pointed that out, and it remains as true today as it was then.

One of the classic stories in this book is about what would happen if 4000 people started flipping coins against each other. You are eliminated from the competition after one loss. Although by definition, half would win and half with lose with each flip, those who had won ten times in a row (as must happen for some in this format) would soon start to give lessons in coin flipping techniques. That story nicely captures the folly of Wall Street. Even though some may win, it usually doesn't mean anything.

The book contains other investment classic stories that you must have in your repertoire. The book is brilliantly illustrated by the classy cartoons of Peter Arno. It is worth acquiring the book just for those.

The subjects covered include Wall Street's passion for prophecy, financiers and seers, customers (or the sheep to be shorn), mutual funds, short sellers, options, speculators and the bull market of the 20s, and the excuses handed out to those who are relieved of their money.

The writing style is urbane and witty. For example, there is the usual disclaimer on not following the advice in the book in the beginning. Except, it is illustrated by two hands with fingers crossed. And, the warnings are a just little different. The information in this book "while not guaranteed by us, has been obtained from sources which have not in the past proved particularly reliable."

The author had discovered that titles cannot be copyrighted, and he "had planned to have my book appear under a good title, The Adventures of Huckleberry Finn."

The author's favorite review of the book contained this phrase, "If I were J.P. Morgan, and I have no reason to suspect that I am not . . . .", and was signed by the author of the review, Mr. Frank Sullivan. The subsequent witty correspondence between them is included in the introduction.

If you are a fan of Louis Rukeyser, you will find the humor here comparable with the badinage on Wall $treet Week during the opening comments.

Seriously, the humor in this book will help you to better understand the risks associated with stock investing. There is a wonderful quiz you can take that will tell whether or not you should be a stock investor. Most will not pass that quiz.

If you still want to own stocks, I suggest that you advance to John Bogle's book, Common Sense About Mutual Funds. It can make you some real money.

If you do not want to own stocks, go instead to Rich Dad, Poor Dad. Follow on to Cash Flow Quadrant.

I also suggest you think about where else folly is taken seriously. This will also put things in perspective for you. My favorite location is the Congress of the United States.

Keep looking for those yachts when you make your investments! To whom do they belong?

Laymen's Fun
Well, maybe this was a 2 star book, but to me it was hopeless from the start. "Fred Schwed", a jokester of a name to begin with talks about Wall St just as naively as anyone who barely knows it.

His viewpoints are clearly from the beginner's point of view, or rather the beginner intermediate- the guy who has just accepted that trading is luck only and that long term investing is simple diversification. He hasn't quite accepted that there are true winners out there and that there is something of an art to the game and eagerly puts any down who attempt to play it. Clearly he has associated with those who are not "in the know" [...]

Anyways, I started at page 1 and read almost to halfway through the whole book before I could bare no more. I really did try to read it through, thinking that I could squeeze something worthwhile out of it. No, I can stand it anymore. I think I'll leave it at the train station on the way to the coffee shop right now! Waste of $[...] and an hour or so of my time..

Definitely not deserving of "Wiley Investment Classic" with the likes of Fisher and LeFevre.

Of the Advantages of Insular Thinking on Wall Street...
This book is very lucidly and wryly written, has sometimes a bit of a cynical objective tone (the author did get burned), but is definitely very humorous, as well as light and agreeable to read. The book is also spiced up by over a dozen of humorous old-fashioned cartoons from Peter Arno.

In essence, this books very entertainingly demonstrates the many advantages of having or gaining an independent critical thinking when facing the follow-the-pack mentality of Wall Street mobbers of all sorts (personally, people in a hurry always made me confused). Indeed, if you hadn't already discovered, the world of finance is probably one of the most implicitly and subtly coercive one there is ...

In these entertaining pages, you will discover that the vast supply of sheer mercantile marketing strategies of Wall Streeters of all sorts are only matched by the benevolent gullibility of a big deal to many Main Streeters. So if you might say there is a certain justice to it after all, you will definitively agree that there is a definite direction as to where the money flows, that is statistically at least... Check out those yachts!

In a broader context, the toll bridge of random walks leading (eventually) to so-called efficient markets does indeed feed on stocks being erratically transferred to and fro at whim, but you can be sure that Wall Street's marketers and intermediaries do have a vested interest in getting their (fair) share out of the (many transaction) deal(s), i.e. the more activity, the better (for them)... But keep in mind that these frictional and parasitic costs are totally non-productive in their ultimate economic end-result, apart from the fact that they provide a liquid (and sometimes efficient) market... a high price to pay for short-term inefficiencies, that also tends to favor a trading instead of an investing mentality...

People's biggest problem seems to be that they just can't sit still (cf. a 17th century author named Pascal...)... But just in case you believe this is another story altogether, let me quote the final words of Fred Schwed's Introduction to the 1955 Bull Market : "[...] my tendency has been to buy stocks, [...]. Then when they show a profit I sell them, exultantly. (But never within six months, of course, I'm no anarchist.) It seems to me at these moments that I have achieved life's loveliest guerdon - making some money without doing any work. Then a long time after it turns out that I should have just bought them, and thereafter I should have just sat on them like a fat, stupid peasant. A peasant, however, who is rich beyond his limited dreams of avarice."

If you are looking for a similar, but more recent, and probably a bit more sophisticated book on insular independent thinking in the face of interested so-called Wall Street and/or corporate professionalism, check out Lawrence Cunningham's fine collection of Essays on Corporate America, also a very worthy and enjoyable read.

To come back to Fred Schwed's book, you will probably enjoy it a great deal, and, 'tell you what, it might even make you richer in what you already have, instead of just making you richer in what you might have, if... to put it otherwise, five hundred dollars and some common sense are often worth much more than ten thousand dollars and the lack thereof, at least in the end result...

Original Motley Fool
"The more things change, the more they stay the same." That's how Fred Schwed, Jr. introduces this gem, if my translation of the French is correct. The book is timely, even though it was first published in 1940. The author shares his observations of Wall Street with wit and humor.

"The chief concern of this book", he states, "will be with an examination of the nonsense ... ." One example is this excerpt from a paragraph he takes out of The Wall Street Journal: "the action of the market was regarded as in the nature of a technical recovery, with little thought of the imminence of dynamic action." Nonsense was apparently well articulated before the bull market of the '90s. Another example is his explanation of why people buy high and sell low when they go to the stock market. They mistakenly believe that once prices are rising (or falling), they'll continue to rise (or fall). "But it is not a fair thing to say of the stock market," he claims,"which, not being a physical thing, is not subject to Newton's laws of propulsion or inertia."

There's more than "an examination of the nonsense" here. Readers may take "A Little Aptitude Test" to see if finance is their calling and consider "A Little Wonderful Advice" on getting rich. If Schwed's advice doesn't make you rich, his hilarious insight will at least make you laugh. ... Read more

Amazon.com

To Peter Lynch, success in the stock market is pretty basic: if a company's earnings rise, then the stock price goes up. "This simple point--that the price of a stock is directly related to a company's earning power--is often overlooked, even by sophisticated investors," the former Fidelity Magellan manager writes in Learn to Earn, his third book on investing. "This is the starting point for the successful stock picker: find companies that grow their earnings over many years to come."

One of the best managers in the history of mutual funds, Lynch is certainly the person to help people choose the right stocks and understand the market. More so than One Up on Wall Street or Beating the Street, this Lynch book is for beginning investors of all ages. Lynch and coauthor John Rothchild are family men who are worried that teenagers aren't learning enough about the importance of American companies in improving lives and creating wealth. Lynch questions why students are taught that Hamlet was a tragic hero and Napoleon was a great general, but they don't know that Sam Walton founded Wal-Mart. In fact, Lynch's grasp of the past is one of the strengths of the book. One of the best chapters is "A Short History of Capitalism," a witty and homespun look at characters like Karl Marx, the Communist who believed capitalism was doomed, and the robber barons, the shrewd railroad magnates of the late 19th century who amassed huge fortunes by manipulating the markets.

Unlike the robber barons, beginning investors, Lynch says, should stick to the basics: get in the habit of saving and investing and putting aside a certain amount every month; develop a strong stomach because the stock market is going to fall and there's no way to anticipate it; do a little homework so you can understand the reasons to own a particular stock; and buy shares in solid companies and don't let go of them without a good reason.

This book marks Lynch's coming out as a fan of "direct investment programs," which are offered by many good companies. You purchase a couple of shares or so directly from the company and then you enroll in a plan and buy more shares each month, in some cases without paying a penny in fees and always without a broker--the way Lynch likes it. Lynch loves these plans because they're a great vehicle for investing a little bit at a time over a long period. Grab onto a company and learn about it, Lynch writes. The more you learn, the more you'll earn. --Dan Ring ... Read more

Reviews (48)

A must for everyone
Unfortunately we'll have to read through passages where Lynch and Rothchild act like the readers are the 15 year-olds that they originally wrote the book for! There is information in this book that even seasoned investors do not know. Unfortunately it isn't all investment info! Lots of history here, which we really should have been taught when we were entering high school! I would recommend Learn to Earn to anyone. They will learn a lot. If you need to learn how to pick stocks based on earnings, try another book after you are done with this one! By the way, I read where Lynch donates all profits from this book to charity!

Awesome for beginners!
My friend lent me this book and I'm so glad he did. I'm a beginner in investing and didn't have a clue about stocks or investing. This book was very concise and clearly written for a beginner investor. I've tried to read other books and either got bored or confused and stopped reading. This one I couldn't put down...so easy to read! I learned A LOT! The chapter on the history of capitalism was also interesting and helpful -- even for someone with a bachelor's in economics. I plan to buy my own copy! Most importantly, it taught me the importance of NOT spending money and investing in it instead!!! AFter reading the book, I stopped wasting money! I plan to read more of Peter Lynch's books!

Good for beginners like me
This book is apparently written for students, but the only way you feel that is the author's occasional attempt to be hip to what brand names his younger readers would recognize.

It is a solid introduction to how companies and the stock market works, with lots of interesting tidbits from history.

I wish he had written more about Index Funds, because further studies have shown me that many experts regard these as the closest thing to a safe bet you can make in stocks. But of course a book consisting of the one sentence "buy index funds" might not sell well. :)

Promotes Dangerous and Inappropriate Activity
Contrary to what the subtitle of this book says, it does not provide an introduction to investing or business. The book is in fact a blasphemous exhortation to 'dabble'- essentially to speculate, in the stock market.

The book, which was written in 1995, right around the middle of the greatest speculative bubble in United States history to date, fed into a common and pernicious malady among small investors- everyone it seems was making 'easy money' in stocks, and naturally many wondered how they too could get some of this 'easy money'. Lynch sought to answer that question within the confines of this misguided, thoroughly misleading book.

Well, of course you know the most recent ancient history. By the end of the 1990s and sometime around 2001, heaps of folks were lucky to have kept about half of what they put into the market, and many never even recovered (nor can they ever hope to recover) their losses to this day. More than a few readers of this book were led astray by the reckless stock cheerleading found throughout this book.

Learn to Earn... was a bad book because it gives the uninformed reader and financial novice just enough information (and an abundance of encouragement) to get himself or herself into a whole lot of trouble in the stock market. It lays out all the benefits of investing, defends with vigor the New Improved American Capitalism, and highlights all the fun and wonderful things that can happen when one one buys stocks and becomes an owner of a Great American Enterprise, without devoting any significant space to the pitfalls, costs and dangers of stock operations. Yet, I sensed in reading this book that the text was written two minds. While Mr. Lynch prattled incessantly about the wonderful world of stocks, with paragraph after paragraph of ebullient optimism, every so often Mr. Rothchild slips in a bit of sobering realism with a sentence or two here and there. In particular, really good morsels of information such as: starting a dedicated savings program before embarking on investing, managing and even better, avoiding, credit debt for investment success, and in any bull market, in the end the little guy gets killed and the Big Boys get bailed out by their rich and politically powerful cronies (as we saw in the last pass of the bull), could only have come from the level-headed and jaded mind of Mr. Rothchild (who by the way authored the cleverly titled gem, A Fool and His Money).

As can be expected with any investment book penned by Mr. Lynch, a number of statements are either half-truths or are just plain wrong. First, Mr. Lynch adheres to his flawed definition of an investor (which he uses in every book)- anyone that buys stocks and only stocks. From this flows his conviction, boldly stated on page 122, "If you are long-term investor, ignore all the bond funds and hybrid funds (those that invest in a mixture of stocks and bonds) and go for the pure stock funds." Throughout the book, he takes a similar stance on individual stock versus bond purchases.

Now, if you had not followed Mr. Lynch's brilliant and worldly wise 'investment counsel', you would have made pretty decent money in both high quality corporate bonds and US Treasuries (or even US Savings Bonds) over the last eight years, especially when compared against your peers who fully invested in stocks. Also, inflation, which Mr. Lynch (and many other scurrilous financial 'experts') uses to scare readers into buying stocks, was moderate during the eight year period, and we even had a spell of deflation at one point, thereby actually boosting bond returns. When all was said and done, it turned out that holding a combination of high quality bonds and high quality stocks out-performed total stock positions over the last few years.

Yet another of Mr. Lynch's erroneous convictions is that investors (buyers of stock) are the vanguards of capitalism. This is a half-truth. In fact, speculators are the vanguard of capitalism, as they provide venture capital and implicitly assume risk. Investors on the other hand, that is, those enterprising souls looking for income with (reasonable) security of capital, only come in after the enterprise has proven itself in the marketplace.

Thus, in essence, readers of this book receive good tutelage on how they too can become speculators, much like the 'stock operators' of the Roaring 1920s. Finally, the fact that the target audienc efor this book is young adults truly shocks me, as quite frankly, Mr. Lynch and others in the financial community are knowingly and purposefully engendering a nation of mindless, stock-buying drones hell-bent on gambling away their hard-won earnings, and their personal financial futures to boot.

Step One
Good beginning book if you have never taken a business class in school or are brand new to investing
Mr Lynch's advice:
Start now
Have a plan
Do your homework
Hang in there for the long term (a 20 year timeline)
I suppose you could apply it to almost anything in life. Losing weight, studying a foreign language, or starting a business etc.
This advice seems a little vanilla to me, however if you are just starting out this may be all you need.
Buy this book if you are in stage one of your investment path. ... Read more

Amazon.com

From the school of unemotional investing comes the classic How to Make Money in Stocks, by Wall Street analyst and publisher William O'Neil. Readers new to securities will find it an excellent primer, one that relies on time-honored indicators such as quarterly earnings, market capitalization, and daily indexes. O'Neil's study of winning stocks stretches back to the 1960s, and he shares his insights here, describing what characterizes a growth stock, when to cut your losses (at 7 or 8 percent, no more), and how to spot a market top.

The techniques in How to Make Money in Stocks are hardly revolutionary, but therein lies their strength, as O'Neil claims his is "a winning system in good times or bad." Investors interested in Net stocks might be disappointed--the author's first rule is that a company must show a pattern of growing profits, which disqualifies many dot coms. (TryRule Breakers, Rule Makers for a different take.) O'Neil's approach to stocks is, above all, rational, and he pays little heed to market hype.

Those new to investing would do well to read this book before embarking, and even more seasoned traders may find How to Make Money in Stocks a refreshing return to basics. Markets may swing bull and bear, but O'Neil promises to stand firm. --Demian McLean ... Read more

Reviews (158)

An excellent book for the beginner to moderate investor.
This is an excellent book for someone starting out in investing. It teaches you WJ O'Neil's CANSLIM method of picking stocks.

What's CANSLIM you ask? CANSLIM is a method of picking stocks developed by William J. O'Neil. He's taken his years of investing knowledge and developed a system of picking stocks that has repeatedly proven to be successful.

The book takes you through each part of this method from quarterly earnings through annual earnings, when to buy, trading volume, stock leaders, institutional support and market direction.

He also teaches you when to sell a stock even in a bad market. He'll show you how to cut your losses and why it's important to sell at the right time to prevent major losses on a stock.

Finally he takes you through some of the best stocks in recent history and shows you how to read the signs that they put out. This will teach you how to recognize today's stocks that are ready to burst from the pack and soar to new highs.

This book pushes WJ O'Neil's newspaper, Investor Business Daily, as it has much of the information needed to use the CANSLIM method. But even without his paper this book teaches you the methods needed to make money in the stock market.

All in all I think this is a great book for investors.

The Book I Started Trading With...
Ten years ago, this book probably launched tens of thousands of eager investors on a journey towards riches. Two years ago, it probably ruined thousands more. I'm not saying that O'Neil's methodology doesn't work. In fact, I have great respect for O'Neil and this book because it launched me on my journey into the markets just a few years ago. The only drawback is that this methodology works best in a bull market environment. When you hit a persistent bear market like we've seen for nearly 2 years now, you are basically sitting in cash spending endless hours looking for that perfect stock to break out of a long-term consolidation. If you don't have the time to search chart-after-chart every night for the perfect setup then you should try a great investment book I just heard about called the 401(k) MarketBuster. The 401(k) MarketBuster will probably find you the same, or better, account returns in the long-run that you'd find with intermediate-term trading; at a fraction of the research time (literally minutes a year). If you are like me and have the time and inclination to learn more about the markets so you can find that elusive "perfect" setup to trade (Lord help you), then you might want to take a look at Dave Landry's book on swing trading. It will offer you more opportunities more often.

The best you'll find.
This is the best system you'll find anywhere. I originally worked as a broker for a firm that followed the Bill O'Neil philosophy and that firm made $$ for their clients consistently. Now I follow this system and trade for my own accounts with even better results. My last stock, TASR, was up roughly 100% (much more on margin) in one month and I found this stock by using the fundamental & technical analysis that I've learned through Investors Business Daily along with dailygraphs (www.dailygraphs.com). His strategy of cutting losses quick and letting winners ride is necessary to preserve capital and maximize gains. AAII (American Association of Individual Investors) rated this as the best performing strategy over several years period.

sparse on some concepts, but relevant in bull markets
First, I would have to comment that the criticism about IBD as a normal newspaper is unfair. Its analysis and opinions are encapsulated in the numbers, systematically compiled for any common stocks worth considering as investments. Any individual investor would see that at one dollar, IBD is a bargain. "How to Make Money in Stocks" is the guide to understanding the ratings of IBD, as well as a clear introduction to O'Neill's investing philosophy. The prevailing market conditions are very important to the success of CANSLIM, and reviews of the book written in the depths of the 2000-2002 stock funk may be colored indeed.

I, too, had some questions about "pivot points," etc. that seem sparsely described. This is because you are supposed to look at the charts. If this isn't enough, look at more charts (the book has plenty). "Pivot points" and "accumulation" are not exact concepts, so one has to practice looking at the chart and acquire an understanding of these concepts. "How to Make Money in Stocks" is one of those rare books that relies on the graphical presentation of data as much as copy writing to communicate its sometimes fuzzy ideas.

This book is superb at describing the CANSLIM method on analysis, which can be done these days with free internet sources. An excellent description for novices of investing research.

My advice would be to pick up this book, read it, buy a copy of IBD, and keep track of ten or so stocks for 60 days or so. If the market goes up and these stocks don't, look for a better method. If you need more comforting words in the newspaper to guide your money decisions, drop this stuff and hire some investment professional.

Invest comfortably
I have been investing in the stock market since 1998. I've made my share and lost my share. However, it was always a chaotic affair. I wasn't investing based on anything solid, it was just going with the market. Besides who could lose in the 90's? Then came 2000 and 2001.
Lucky for me I ran into this book and let me tell you something, it has made me comfortable with the way I invest. I don't need to keep up with the market every minute and I don't stress as much. I also understand better how to read graphs and how to interpret market activities. A book well worth it.
It does mention the Investors Business Daily paper a lot because they publish it but it's a worthy paper also so I don't see anything wrong with that. ... Read more

Amazon.com

Should you let a Fool tell you where to invest your money?If he's aMotley Fool, the answer is a resounding YES!David and Tom Gardner launchedthe most successful investment information service ever to grace cyberspace,and now they show you how to beat the market, even if you don't know adividend from a divining rod.With this guide, you'll find out how theinformation revolution can put money in your pocket. ... Read more

Reviews (100)

Finally, an investment guide for normal people
Dave and Tom have created an immensely readable and informative book for the average Joe who wants to learn how to invest in the stock market. Their liberal use of humorous examples makes the book hard to put down. They explain why mutual funds are usually a bad choice, how to do your own research, how to avoid sky-high commissions, how to do your own research on companies, the difference between fundamental analysis and technical analysis (and which one is basically worthless), and even how to make money in a bear market (yes, it can be done, and it's a lot easier than you might think). Overall, if you are looking for a simple and fun explanation of how to get started in investing, you can't possibly go wrong with this one.

Foolish, in the Very Best Sense
So, are you young enough to be looking at 10 to 30 years ahead of you to cosset your investments into something bigger than a breadbasket? Are you, at the same time, flush enough to have (perhaps after a few years of scrimping) 25 to 50 thousand dollars that YOU DON'T NEED? Are you comfortable with numbers? Can you, or can you learn to, look annual reports and financial statements in the face without flinching (or glazing over)? Does making an average of 15 to 20 percent per year on your portfolio over the long haul (for the ride may be bumpy, with some dives as well as climbs) sound sufficiently enticing? Do you have a day job that you intend to keep? Do you have a life outside of playing the market that you intend to live? Then, and only then, this could be the book for you!

I love these guys. They're a couple of fresh-faced young men, brothers, who treat investing seriously, but that doesn't mean somberly. The first chapter or so of this book was so jokey I thought the ratio of matter to chatter was going to be about 1:1, but they got down to business, as it were, soon enough.

Their basic point is that anybody who is willing to do some work looking at the fundamentals of companies can find some to invest in and, usually, stay with, that will significantly outperform the market. A person can build a portfolio of stocks that will beat the Dow, or the S&P 500, by several percentage points every year. Since the market, overall, is rising at 10 or 11 percent (ok, bad year to convince you of THAT) annually, over the long haul this 15 or 18 percent compounding of one's portfolio can lead to significant gains.

And the lovely thing is, most of these are tax-deferred, since only the dividends of stocks that you hold are taxed, and the plan is to hold your stocks, not to churn them. If you do your homework well you should have stocks that you stay with for years - perhaps even leave to your loved ones, who will therefore treasure your memory.

Yeah, yeah (I can hear you muttering): "willing to do some work"? Well, yes. YOU CAN'T GET AROUND IT! You have to crunch a few numbers, but it's fifth-grade math (some long division is required). You have to get cozy with financial statements. It'd be nice, moreover, if you understood something of what the company you want to own a chunk of does for a living (it might become YOUR living!), and some of the high points of its spectrum of the economic universe.

The brothers will introduce you to some good ideas, and puncture some bad ones. They demonstrate why small caps are so great for the individual investor, for example. They tell you when, with impeccable logic, it is a bad idea to short a stock (even a stock about to plummet). They talk turkey about the real costs of trading - the commissions AND the spread. They quickly demolish the allure of day-trading. They campaign tirelessly for honesty and transparency in investment advice, and point out the problem with almost all mutual funds (except for the index funds, which they like, but just not as much as individual stocks).

Oh, and they run a web site, which no doubt nets them a few bucks, which I certainly don't begrudge them. They are for power to the people, online power to the upwardly-mobile investor-class of people, anyway. (Hey, you have to start somewhere!)

Mostly, this book is inspirational. It's message is that you, the ordinary Joe or Jane, can put away a few bucks and then invest it intelligently. If you're not using the rent money, and if your time horizon is meaningful - 10 to 30 years - you can come out the other end with a real, honest-to-goodness nest egg. This is NOT a book about making quick profits, or getting wealth without work. It DOES say that it doesn't take too much work, and it does take several years, but that if you apply yourself, and hold the course, you will do better in the long run than all the fund managers in the financial industry. But more importantly, you'll do well. Also they start the book with a snippet from one of my favorite poems, so I have to trust them!

Good intro for wannabee Fools
This book is pretty good for first time or novice investors, the Gardner brothers discuss the advantages and disadvantages of different investment methods most notably: mutual funds, index funds, and stocks. Also it seems these Fools (yes they like to be called that) like investing in Dow stock, much of their information regarding Dow stocks appears to come from Michael O'Higgins author of Beating the Dow. Another method that the brothers introduce is one of their own for picking out small cap growth stocks, here's what they look for:

Sales of less than $200 million
Daily Dollar Volume of $3 million or less
Low Price $5-$20
Net profit margin of 10% or more
Relative Strength (IBD) of 90 or higher
Earnings and sales growth for the most recent quarter of 25+ or more
Insider holdings of 15%+
Cash flow from operations should also be a positive number

This book is primarily aimed at beginning investors who want to hold growth stocks for a year or more, however a lot of this book is focused on them talking about their website www.fool.com

My favorite part of this book would have to be the chapter on Zeigletics: The Penny Stock That Never Was.

Reed Floren

Decent Investing Primer, but not much more
The Motley Fool Investment guide by the Gardners was a fairly interesting primer on the subject of investing, with a particular emphasis on stockpicking. However, that is ALL you should take it as. It should merely be viewed as ONE type of overview of the stock market that may or may not be valid under current market conditions.

Note: Beginning investors should be very wary of following the strategies outlined in this or ANY investing book with any significant sum of money. Run a simulation portfolio and test out the validity of these methods before you plunk your hard earned cash into some particular system. Be warned. My opinions may sound very negative and you may be at a loss of confidence, but I do believe you'd rather take a beating in your emotions before you take one with your portfolio.

Now, overall, the book offers some nice stratagems for newer investors and is written in a very friendly style to keep people interested. The book is laced with the Gardners' personal style of humor(which I wasn't particularly fond of), but they did manage to keep the book fairly light-hearted and easy to read. With that said, I believe a key flaw of this book is that it makes achieving market-beating returns seem fairly easy.

Would it be feasible to believe that anyone could suddenly start playing NBA quality basketball were that person to read and follow some simple exercises in a book entitled "Play Basketball like Michael Jordan"? How about "Tiger Woods in 20 Minutes"? Yes my friends, it is very possible to play pro ball by doing my secret exercises for only 20 minutes a day, because in my new book, I have outlined some very secret and powerful methods that will make your growth in talent and muscle EXPLODE! *cue slightly altered techniques found in a basic exercise manual wrapped around in clever and seductive writing.

The notion that someone can play professional, all-star level ball by reading a book and following simple exercises would quickly be dismissed as utter BS. But in the world of investing, 'secret methods,' 'the methods of the pros,' etc. etc., always seem to entice new investors into buying a $15 manual to learn the secrets to beat the market. Maybe Peter Lynch can get by on beating the pros by looking at investments only a few hours a week because his decisions are built on experience... It may be easy for a professional bodybuilder to lift 350 lbs, but does that mean the average man can expect to do the same? To suggest that the newcomer can beat the pros by spending only a few hours a week and using a very simple system sounds quite like the 'pro ball' scenario, no?

You certainly won't get consistent market beating returns by following the very scanty guidelines offered in this book. Another area of fault with the book is that, at times, it seems like you've just spent your hard-earned money on a big advertisement. The constant plugging of their website is extremely annoying to say the least. It almost seems as this book was geared to get you to join their website.

With all of that said, the book offers a decent, easily followed write-up of long term investing fundamentals. It's a nice overview of the subject of investing, and beginners will learn some good lessons, but by no means should they believe that by reading a couple of investing books and following the simple guidelines within should they expect to beat the market over the long-term. There's a reason most mutual funds don't consistently beat the market over the long-term. And no, it's not because the majority of mutual funds are run by complete dunces (some of you may tend to disagree). The objective of obtaining market beating returns isn't nearly as easy as it seems.

this book is bad
The information contained in this book has been discredited by lots of academics and yes, even by the Gardner brothers themselves. Don't buy this or any of their terrible books. ... Read more

Book Description

THE NATIONAL BESTSELLING BOOK THAT EVERY INVESTOR SHOULD OWN

Peter Lynch is America's number-one money manager. His mantra: Average investors can become experts in their own field and can pick winning stocks as effectively as Wall Street professionals by doing just a little research.

Now, in a new introduction written specifically for this edition of One Up on Wall Street, Lynch gives his take on the incredible rise of Internet stocks, as well as a list of twenty winning companies of high-tech '90s. That many of these winners are low-tech supports his thesis that amateur investors can continue to reap exceptional rewards from mundane, easy-to-understand companies they encounter in their daily lives.

Investment opportunities abound for the layperson, Lynch says. By simply observing business developments and taking notice of your immediate world -- from the mall to the workplace -- you can discover potentially successful companies before professional analysts do. This jump on the experts is what produces "tenbaggers," the stocks that appreciate tenfold or more and turn an average stock portfolio into a star performer.

The former star manager of Fidelity's multibillion-dollar Magellan Fund, Lynch reveals how he achieved his spectacular record. Writing with John Rothchild, Lynch offers easy-to-follow directions for sorting out the long shots from the no shots by reviewing a company's financial statements and by identifying which numbers really count. He explains how to stalk tenbaggers and lays out the guidelines for investing in cyclical, turnaround, and fast-growing companies.

Lynch promises that if you ignore the ups and downs of the market and the endless speculation about interest rates, in the long term (anywhere from five to fifteen years) your portfolio will reward you. This advice has proved to be timeless and has made One Up on Wall Street a number-one bestseller. And now this classic is as valuable in the new millennium as ever. ... Read more

Reviews (102)

Be smart and BUY this book!
This is the first book I ever read on investing. My cousin, Paul, who was a broker at Merrill Lynch, recommended it to me. I followed Paul into the financial services industry, toiling 12 long years peddling stocks, bonds, mutual funds and insurance products. During my tenure as a Wall Street professional (I use that term very loosely), I must have read 200 different books on investing. Oddly enough, I have discarded many of those poorly written investor guides and still refer back to this classic book penned by Peter Lynch, mutual fund demigod, investment guru, stock-picking legend!

At the heart of Lynch's case is that each individual has enough inherent knowledge and experience to be a successful investor. He uses numerous analogies to show investors:

1. The power of common knowledge (take advantage of what you already know) 2. You don't need to be a Wall Street analyst to uncover great investment opportunities 3. You are not disadvantaged vs. large, institutional investors You don't have to accurately predict the stock market to make money in stocks 4. To keep an open mind to new ideas

From my years on Wall Street, I found many of his theories and ideas to be completely accurate. Many other books I have read focus on the inherent evils of the possessed financial consultant community. Yes, the industry has its problems. However, $8 stock trades are not the only ingredients in profitable investing. In fact, I don't recall him emphasizing the need for discount trades, a fact over-emphasized in almost every other book I have read (remember, I am no longer in the industry...I don't need to strike a case for broker commissions). Instead, he shows you what information to focus on and how to apply it.

Do yourself a favor: Buy this book. Read it twice. It is not outdated...it is timeless. Yea, I know, you already know it all. My advice is to lose the ego and take a refresher course on common sense investing. When you finish, put it on your bookshelf. Do not give it to your kids or neighbors; buy them their own copies. This is a great book!

A Capital Read!
I borrowed my copy of "One Up On Wall Street" from a friend who is a longtime professional equities investor. He received this gift as recommended reading from a veteran investment analyst he knows. While Peter Lynch has written an easily comprehendible advice book on common stock investing - very much written in layman's terms and without emphasis on industry jargon - the principles he puts forth are fundamental and worth reviewing by anyone, amateur or pro.

Within the 300 pages of this book, Lynch outlines a useful rubric against which all stock selections might be measured. His stocks fall into six categories: Slow Growers, Stalwarts, Cyclicals, Fast Growers, Turnarounds and Asset Plays. Screening, buying and selling advice are outlined for each of these six flavors, although nothing revolutionary (eg., Sell a slow grower when the dividend is unattractive.) He delivers a wealth of the basic analytical tools (well, more like rules of thumb) for stock research, explaining price earnings ratios, the import of tax loss carry-forwards, goodwill accounting, inventories, and other basics of P&L statements and Balance Sheets. It's a pocket guide financial course for those who may have slept through Accounting 101.

Lynch urges stock pickers to do their homework, and suggests the regimen of a "Two Minute" drill, whereby an investor can recite a brief monologue of reasons for selecting a security: Reasons for selection, what the company needs to do to succeed, and pitfalls that stand in the way. Obviously, this is not a book for the technicians or chartists. Nor even speculators, as Lynch reminds the reader that his "ten-baggers" or "forty-baggers" all come as a result of having held at least three to four years.

Quite a bit of the book carries a populist bent. There is plenty of advice to pay more heed to what's happening in the local shopping mall than to investment brokers ("oxymorons"), and to avoid stocks with exotic names or that may have been whispered to be hot. Of course, we've all been aware of this, and we're all wealthy and drinking daiquiris on the beach now, right?

In sum, it is worth the investment of the few hours it takes to swallow this information. At worst, it is an entertaining look at some high-fliers the former Magellan manager scored with, but at the very least it serves as reminder that basics need to be followed, and nothing works as well as solid research, good discipline and old fashioned hard work.

For financial analysts to be!
I first read this book as an "assignment" when I started working as a financial analyst in 2000. The book is well written, and offers a lot of insights and tips that are applicable to analyzing companies and stocks. Most of the stuff here are very applicable to my work, and even offers examples that can be emulated by any investor/analyst. To date, I still practice most of the philosophies and tips suggested here when it comes to analyzing companies. Amazingly, the book is not written in financial jargon but rather in a simple way that even novices would easily understand. i rate this book a "buy!"

Probably the best stock investment book ever
This is a terrific book for stock investors of all levels, beginner through advanced. Lynch has tremendous credibility, as an extremely successful long-term mutual fund manager. And he shares a good deal of his investment knowledge with readers in this book. The author shows why stocks have been better than cash or bonds in the long run, and covers the basics of valuation: PE ratios, earnings growth, brand value, financial/cash position, etc. Then he points out that each individual investor brings their own "edge" to the investment table, such as that a truck driver might notice that he's delivering more for a growing business before "The Street" realizes that the business is growing, or a retail sales clerk might have a better handle on what's selling than a Wall Streeter in New York City, etc (this "edge" is the "One Up" part, referenced in the book's title).

I read this book before I got serious about investing myself, it's helped me to be successful (I've "beaten the street" fairly consistently, much of this thanks to Lynch's book) and I've re-read it several times over the years. My biggest problem with this book is the printing; while the quality isn't terrible, it could be a lot better, a lot more readable. This is a book just CRYING to be published again in hardback, with new, larger typesetting. And I don't mean that little miniature abridged hardback version. Considering the popularity of this book, and the great number of well-to-do investors, why not sell us a leather bound, acid free paper, nicely typeset version for $50-$75 retail? Until that ever happens (unlikely, but I can hope) this excellent investment book will have to do in the current paperback form. Remember, if you are considering investing in stocks - start here, read this book! And even if you think you know it all, you still should read Lynch's book, it's that good.

Read it
If your read one book on investing, make it this book. If you visit one site on investing, make it Fool.com

The kind of patience required in seeking the kind of gains you can only reap by holding through volatility and buying & selling on fundamentals & valuation is the key piece of knowledge that you will gain from this book. We're too bombarded on a daily basis about the daily swings of the market - the result? More and more people with less patience failing to make the kind of gains that can only come with good stock picking and more importantly, the patience demonstrated by investors like Lynch, Buffet, Graham and Shelby Davis. ... Read more

Book Description

"You will find lots of jewels in these pages that may do as much for you as they have for me."—from the Introduction by Kenneth L. Fisher Forbes columnist

Widely respected and admired, Philip Fisher is among the most influential investors of all time. His investment philosophies, introduced almost forty years ago, are not only studied and applied by today's finance professionals, but are also regarded by many as gospel. He recorded these philosophies in Common Stocks and Uncommon Profits, a book considered invaluable reading when it was first published in 1958, and a must-read today.

Acclaim for Common Stocks and Uncommon Profits

"I sought out Phil Fisher after reading his Common Stocks and Uncommon Profits...When I met him, I was impressed by the man as by his ideas. A thorough understanding of the business, obtained by using Phil's techniques...enables one to make intelligent investment commitments."—Warren Buffett

"Little known to the public, rarely interviewed and accepting few clients, Philip Fisher is nevertheless read and studied by most thoughtful investment professionals . . . everyone will profit from pondering—as Warren Buffett has done—the investment principles Fisher espouses."—James W. Michaels Editor, Forbes

"My own copy [of Common Stocks and Uncommon Profits] has underlinings and marginal thoughts throughout."—John Train Author of Dance of the Money Bees ... Read more

Reviews (25)

Solid read; practical ideas
This book is a classic in the investment field. Fisher is acknowledged as one of Warren Buffet's intellectual fathers and it shows. However - like many books on Buffett - Fisher's approach relies on the ability of the individual to spend large amounts of time researching companies and stocks. While this minimizes the risk of investing badly, it also assumes that picking stocks is your life. I recommend that anyone interested in investing read this text as an example of how to think about companies in which to invest. However, be prepared that it won't be as directly usuable as, say, the writings of Peter Lynch.

Not your typical investment book
"Common Stocks and Uncommon Profits" was an investment book with a different focus. Fisher focused not on valuation aspects such as the ones Ben Graham would use or technical trends that other would use, but instead focused on seeking out stable companies with good management and other qualities. Fisher prefers growth companies exhibiting substantial income and revenue growth. He likes what I would call the intangibles of stock investment; exceptional management, marketing, sales, and many other segments of a company. The only knock on Fisher's work is that he assumes normal people have the time or resources to seek out the leaders of a company. He also assumes that if you don't seek out the leaders of a company that you aren't doing your due diligence. Either way this book did provide me with several new concepts that I knew were important to investing but hadn't really thought about. This book will cover topics that Lynch, Graham and the other investment writers haven't covered.

quite a few nuggets, but impractical at times
when "scuttlebutt" is one of the leading litmus tests before investing, you're dealing w/ a program that is impractical for average individual investors. but the book is quite valuable for its focus on long run investing, its 15 rules for investors (and moreso, the rules for investors to NOT follow), and its stress on conservatism in practice is very helpful.

ultimately, this book is less about security selection than it is in investing philosophy---which it excels at. that's why buffett loved it, and you may too.

A Must for Every Investor's Library
I first read this book over ten years ago, and like the other reviewers, I too found it a difficult read. When I first read it, I thought the advice was somewhat impractical for the small time investor (try to imagine calling Bill Gates asking him what he thought of Steve Jobs' company). Graham's security analysis was much easier for the little guy investor to apply. Yet Fisher's techniques were and are used by the big time investors ( most notably Peter Lynch, and though I don't think he gives Fisher enough credit, Warren Buffett). Even the rankings of "Top CEOs" by Forbes, Businessweek, Fortune etc. was based on Graham's security analysis. Then came the corporate scandals of the 1990's, the Sarbanes-Oxley Act, and Elliott Spitzer of New York and now the little guy investor can apply Fisher's theory of investing. Fortune Magazine's CEO ranking has as much to do about corporate governance as it does with security analysis. There are websites devoted entirely to corporate governance. The Institutional Shareholder Service was created solely to act as a corporate governance watchdog. I recently re-read Common Stocks. It's still a difficult read and you can't read it in one day or even in one week. It's a book that you have to read and re-read to get the most out of it. The most useful chapters for an investor are Chapter 3 "What to Buy: the fifteen points to look for in a common stock", Chapter 8 "Five Don'ts for Investors, and Chapter 9 " Five More Don'ts for Investors." Fisher's Common Stocks and Graham's the Intelligent Investor are the two basic building blocks that every investor must master to be succesful in the stock market.

The Best Investment Book of All Time
I first read this book in 1992, and it did nothing for me. At the time, I had very little investment experience and was only starting to study the market. I re-read the book again in 2001 and, wow, it took me to a different level.

I would not recommend this book to investors who have less than 5 years of stock investing experience. You simply wouldn't get much out of it and might unintentionally lead you down the wrong path. Once you get your investing fundamentals down, this book will expand your horizon beyond your dreams.

Warren Buffett credited Ben Graham as the most influential force in his investment style/thinking, but I believe that it's Philip Fisher who gave him the edge and made him one of the great investors of the 20th century. ... Read more

Reviews (16)

Great!
I think this is a great book for someone wanting to get started in their personal financial planning. It is easy to read and not boring like other financially-oriented books. You'll be ready to develop your own financial actions plan after reading this!

If you don't want to die poor, you'll read this book.
At the time this book was given to me (by my Father), I was a Research Analyst for a mutual fund company. I thought I knew all there was to know about investing....but boy, was I wrong. In addition to working in a financial field, I was also married and had children. Reading this book showed me in such a simplistic and entertaining manner, how incredibly EASY it is to build wealth no matter what your income level is. I also learned about wills, life insurance, and other things that I never gave any thought to, but reading the book gave me insight as to just how important these things are...not to me, but to my family. My father is a very intelligent individual and has great money-sense. He is 51 years old and has never paid a single dollar in interest on his credit cards ! Now that is someone who knows how to properly manage his money ! He himself said that this book is propbably the most important and eye-opening book he has ever read - and that's why he gave it to me as a gift. If you are someone who has always been leary of investing, have no plan for retirement, or have a family, then you MUST read this book. It is written in a story-book format and reads just like any novel. This is not a financial lingo, how-to-get-rich-quick type of book. The "story" WILL show you how to build wealth....slowly, so you will be able to retire in style, not having to worry about money. Do yourself a HUGE favor and read this book. I guarantee that you will not regret it.

A Must Read!
Provocative, engaging and riveting are not normally words associated with a book on financial planning; however, I do not hesitate to use either one to describe this book. I was definitely not excited about financial planning until after reading the first edition of this book.

Chilton continues to uses a narrative style using characters that just about anyone could relate to. The Wealthy Barber breaks the age-old mind-set that only the rich can be rich. An excellent primer, you can apply techniques in his book today to ensure a better tomorrow. He also encourages further exploration and learning in order for anyone to become wealthy. Whether you're an executive or a gas station attendant, given patience and a little fortitude, you too can be wealthy!

I urge you, read this book!

AN AMAZING BOOK ABOUT HOW WEALTH IS BUILT
David tells us in this book how to build wealth. The tip he gives us is this...for us to save money out of every pay check. He recommends saving 10% out of every pay check. This is a very good idea and i strongly recommend this idea. If for some reason you can't save 10% out of each pay check, then i think that any amount that you can save should be adaquate. Please remember that saving money is just a small tip of the ice berg. You must remember that once we save our money, then the next step is to invest this money. Money needs to be growing at all times. Were you invest your money will be up to you. I personally invest in the stock market. I would strongly recommend this book. It can put you on the right track to financinal success.

Absolutely Amazing
This book provides the common working class man a opportunity to smartly and efficiently save money and achieve financial independence. The book itself uses a story to convey its message, and is easily understandable and readable. I would recommend this book to anyone who wants to get ahead in life. ... Read more

Reviews (6)

Sour Grapes
Four out of five brokers do not last five years. That is why the "salesmen" get weeded from the people who have their clients interests at heart. The author is one who got weeded out. Good ideas to protect yourself from salesmen, but the indictment of the industry is overdone. Brokers do make their living from commissions, but cheating clients is not the way to build a practice. Best advice: Find someone who got past the wash-out phase.

Excellent description of how Merrill Lynch operates
In the Preface of his book, Mark Dempsey states, "Out of fairness, however, I have withheld the name of the brokerage firm that I worked for." Elsewhere he mentions that his previous job was selling radio advertising time. A check of the NASD list of past and present brokers includes a "Mark Dempsey" who, between 1992 and 1995 worked for Merrill Lynch in Dallas, TX. Prior to that, between 1985 and 1992, this "Mr. Dempsey" held sales positions with five different radio stations or networks. Coincidence?

Excellent--read it more than once
I was all set to review this a few days ago, but since I had read it quite awhile ago, I decided to re-read it. Am I ever glad I did! I do not like all the "broker bashing" that goes on. I must be the only person left on the planet that does not think full-service brokers are the devil incarnate. HOWEVER, I did see my broker in some of these examples. Surprise! Surprise! (He's the Master of the Pregnant Pause). This book is required reading for anyone about to invest. I do not believe it is as easy as a lot of people say it is to invest on your own--and I say that after reading piles of books. I say watch your broker like a hawk and keep this book handy as a reference. (By the way, the first time I read it I thought it was so good I bought a copy for the library where I work at my own expense). Please write more books like this one.

Investors get inside scoop on stockbrokers
Pretty decent book on how stock brokers really operate. Shows how your interests are rarely (if ever) important to a broker. The book is a fairly quick read. Several examples of sales techniques followed by an analysis of each. At the end the author suggests that each of us is better off investing our money ourselves but does not give any additional information on how to do this other than the general comment of going to a bookstore and buying books on investing/personal finance. The author does a good job of not only criticizing the brokerage industry but also offers suggestions on how it can be approved. Overall I would say that it covers the topic well and opens the readers eyes.

Eye-opening reading.
This book offers a very good view of investing from the eyes of the stockbroker and explains why his or her eyes are not necessarily focused on your financial well-being. Chapter six was one of the most informative chapters. It reviewed the "tricks of the trade" stockbrokers use to close an investment deal. ... Read more

Book Description

In 1991, Michael B. O'Higgins, one of the nation's top money managers, turned the investment world upside down with an ingenious strategy, showing how all investors--from those with only $5,000 to invest to millionaires--could beat the pros 95% of the time by putting 100% of their equity investment into the high-yield, low-risk "dog" stocks of the Dow Jones Industrial Average. His formula spawned a veritable industry, including websites, mutual funds, and $20 billion worth of investments, elevating the theory to legendary status.

Reflecting on the greatest bull market of our time, this must-have investment guide has been revised and updated for a new economy. With current company and stock profiles, as well as new charts, statistics, graphs, and figures, Beating the Dow is the smart investment that you--and your portfolio--can't afford to miss

Reviews (16)

Sounds too good to be true
This is a classic book describing a simple method for achieving outstanding results in the stock market by investing in a selection of five stocks from the Dow Jones Industrial average. There is one little problem. The method hasn't worked very well recently. Taking some data from the table on page 204 of the O'higgins book we see the % gain or loss of the selected five stocks compared with the Dow Jones Industrial Average: (Year, Five stocks, Dow Jones Average);(1994 8.6 4.9),(1995 30.5 36.4), (1996 27.9 28.9), (1997 20.5 24.9), (1998 12.3 17.9). The method has faied to Beat the DOW every year since 1994. My own calculations shows that this under performance continues into 2001. The Motley Fool Group has done extensive research on this method and after their initial enthusiam they have recently terminated their recommendation. Serious students of the market should buy this book. Further study of this approach may lead to new methods for "Beating the Dow".

Investing sensibly
Some people might laugh at this book specially the brokers who make living by sucking the commision out of an average investor. What had happened in the NASDAQ in 1999 before the correction was absolutely mind blowing and this book might have looked like a bad joke i.e. advocating to invest in companies like International Paper! but now that the dotcoms are down the drain, the valuations are somewhat back on earth, the margin-debt bitten people are done crying, maybe it is time that us i.e. average investors read this book.

This book as the name says is all about investing in Dow companies, the giants of the US and global economy. The companies which I truly believe that world could come to an end but GE would still be there. The book covers all the Dow components individually along with their historical financial performance, weaknesses, strenghts and their power to stay in business by being profitable over years and years. There are many different 'low risk' investment strategies covered in this book such as 'High Yielding 5'. These are the 5 Dow stock that you pick annually based on the criteria described, HOLD it for 1 year, redo the math (barely any)and pick your 5 stocks again. You also sell some at this point that didn;t meet your criteria and pick the new ones to fill their spot.

Sounds simple, yes! and that's the way it should be. Not only you can ride out the swings of the stock market in this way but also save a ton on commisions, taxes and most importantly be less stressed.

If you read the Motley Fool, you'll notice some of their strategies are derived from O'Higgin's methods.

A must read for all investors, specially younger people like myself who want to start building the nest yesterday!

Not a totally bad method of choosing stocks
"Beating The Dow" by Michael O'Higgins offers the following simple investment strategy. You simply buy the ten highest dividend paying stocks among the Dow Industrial Averages. The Philosophy is that as the value of the stocks increase, via stock price lagging or falling below the market, the dividend yield will tend to rise. (i.e. the assumption is that dividend yield is a proxy for value. One problem is that not all Dow stocks pay out the same level of earnings, so some stocks will tend to have higher dividends.)

While I tend to be skeptical of any investment strategy that is too simple, if you must use such a simple strategy, then you could do far worse selecting the highest dividend paying stocks from the Dow. Of course, the other option is just to index your money in a mutual fund that buys the entire stock market. Vanguard Funds is the leader in such index funds. But, I like dividends.

The difficulty with simple investment strategies is that they tend to be arrived at via data mining. The proponent of the investment method asks "What worked in the past?" and then tries to draw up a canned investment method. Almost always, the proposed method then starts to lag behind in the present and future stock market performance. (the recent performance of this strategy is discussed in another person's great book review. See that.) This is not due to market efficiency or that the method is becoming well known. It just means that the method wasn't entirely valid as a predictive method.

There is the old joke about the "X investment strategy." When a computer was asked to vigorously evaluate the stock market and look for predictors of future investment success, the computer spit back the answer, "Invest in stocks whose name begins with an 'X' and whose name ends with an 'X.' " Xerox was the top performing stock over the period.

"Beating The Dow" is one of those books, if read all by itself, might mislead a new investor into an over-simplified investment strategy. Yet, you might enjoy reading it. And, as stated, you could do worse than holding the ten highest dividend-paying Dow stocks.

"Beating The Dow" also mentions what Michael O'Higgins calls the "Penulatimate Profit Prospect (PPP)" which involves buying just one stock. The Stock with the second lowest price among the ten highest yielding stocks. I consider that Penidiotic. We conservative investors do love our stock dividends, and the focus on dividend yield gets "Beating The Dow" a solid honorable mention.

Peter Hupalo, Author of "Becoming An Investor: Building Wealth By Investing In Stocks, Bonds, And Mutual Funds."

Beating the Dow, Still an Unbeatable Read
Michael O'Higgin's investing classic holds up as well in the New Millenium as it did when it first hit book stands 10 years ago.

He maintains that it is still possible to beat the DOW by buying the 10 highest yielding stocks and tweaking your holdings each year, with correspondingly greater rates of return with a two- or five-stock selection from the group. O'Higgin's admits in the new eidtion that the strategy has been muddied by a drop in the relative importance of dividends as a part of total yield of the DOW. Dividends and payouts have lost lost out to stock buybacks, in part because dividends are taxed at a higher rate than long-term capital gains from stock sales. Changes in the DOW have also reduced the overall dividend payout. Of the most recent additions, Microsoft pays no dividend and Intel and Home Depot have nominal payouts. O'Higgin's strategy may also be less effective because it's simplicity and past returns attracted the attention of Wall Street money managers and of many, many individual investors. There is at least one web site devoted to the Dogs of the Dow and a number of similar investment strategies were profiled for several years on the Motley Fool website.

Nor is the most valuable part of O'Higgin's book his thumbnail sketches of other value strategies for beating the market with a basket of DOW stocks. Several seem downright ridiculous. I remain skeptical that investing based on presidential election cycles or end-of-year asset sales by fund managers can yield meaningful, long-term results for individual investors.

The value of this book is O'Higgin's championing of value investing in general and his highlighting of the resilience of the DOW stocks in markets bull and bear. Most people aren't professional investors and lack the time and resources to profit from a strategy of active trading. If the efficient markets guys are right, then buying all 30 DOW stocks and holding on long-term will beat returns of most professionally baskets of stocks, with less risk and less payouts for taxes and trading costs to boot. Or maybe buying the highest yielders in any given year and holding. Anyway, you get the picture.

Regardless of whether you think the high-yield 10 is still capable of outgaining the overall DOW, O'Higgin's book is, to me, as valuable in 2001 as it was when