The investing world can be difficult to navigate, especially when you’re just starting out. There are a lot of confusing terms and complicated acronyms that can deter someone who wants to learn more about financial concepts.
Fortunately, there is no shortage of investing books that can help you learn what you need to know to become a smart investor. Books can be read at your own pace and are usually written by experts who have spent years in the industry researching investments.
Here are some of the best investing books that beginners can consider adding to their reading list.
Best books on investing for beginners
1. The only investing guide you’ll ever needby Andrew Tobias
If you’re really just getting started with investing, this book is a great starting point. You’ll learn tips on how to save and invest for your future and get excellent advice on what to avoid in the financial world. Tobias has a great sense of humor, so the book is fun to read even if finance and investing are not your favorite topics.
“The Only Investment Guide You’ll Ever Need” was first published in the 1970s, but has recently been updated and has stood the test of time. It’s a great first step on the path to becoming an expert investor.
2. The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returnsby John Bogel
Vanguard Group founder John Bogle, who passed away in 2019, spent his career advocating for and delivering products and services that benefited everyday investors. Legendary investor Warren Buffett wrote in 2017 that if a statue were ever built in honor of the person who did the most for American investors, the choice should be Bogle.
Bogle was a strong proponent of investing in index funds and keeping costs to a minimum, which would put a greater share of market returns into the pockets of shareholders rather than those of fund managers. His book shows why it’s so important to keep costs low when you invest, and discusses taxes, mean reversion, bonds and exchange-traded funds (ETFs).
3. Richer, wiser, happier: How the world’s biggest investors win in markets and in lifeby William Green
Written in 2023, this book by William Green has quickly built a reputation as one of the best books on investing. In it, Green profiles some legendary investors, including Mohnish Pabrai, Howard Marks, Charlie Munger, and Nick Sleep, and shows readers what lessons we can learn from each of them.
Many of the investors profiled share common characteristics such as independence, resilience, simplicity and clarity of thought. Reading about the journeys of these great investors and the different paths they took to achieve great wealth is inspiring and filled with lessons on how to succeed in investing and in life.
4. Warren Buffett’s Essays: Lessons for Corporate Americaby Warren Buffett and Lawrence Cunningham
Warren Buffett is one of the clearest thinkers on investing the world has ever seen, and he has been kind enough to write down many of his thoughts in the form of his letters to Berkshire Hathaway shareholders. Lawrence Cunningham, a professor at George Washington University’s law school, organized the letters by topic, such as corporate governance, mergers and acquisitions, valuation and accounting.
Despite the complex topics, the book is not difficult to read. Buffett has said that he writes the letters in mind of his sisters, who were smart and interested in business but not as knowledgeable as he was in the subject matter. Readers will gain valuable training in business and investing.
5. The little book that beats the marketby Joel Greenblatt
As a hedge fund manager in the 1980s and 1990s, Joel Greenblatt generated annualized returns of about 50 percent. Since then, he has devoted part of his time to teaching and writing books, hoping to help others generate better investment returns.
In “The Little Book That Beats the Market,” Greenblatt explains his magic formula for identifying great companies that are undervalued. The book uses simple mathematics and is written in such a way that anyone can understand the concepts discussed. Whether you apply the formula yourself or not, the book is one of the best books showing how and why a simple strategy can deliver excellent returns over time.
6. One on Wall Streetby Peter Lynch
Peter Lynch was a household name in the 1980s, managing Fidelity’s famous Magellan Fund. During Lynch’s 13 years running the fund, assets grew from $18 million to $14 billion and easily outperformed the S&P 500.
‘One Up On Wall Street’ explains Lynch’s investment philosophy and how everyday people can outperform professional investors by sticking to what they know and keeping their eyes open for stock ideas. He convinces readers that they can find the next big stock by paying attention when they’re at the grocery store or mall (or maybe shopping online today). Lynch’s tips can help you identify a “10-bagger,” or a stock that returns ten times its purchase price.
7. The psychology of money: timeless lessons about wealth, greed, and happinessby Morgan Housel
While not exclusively focused on investing, The Psychology of Money is an excellent and practical book that focuses on the many ways consumers make decisions about money. Often economists and financial experts assume that people are completely rational when they make decisions about their finances, but we know this couldn’t be further from the truth.
Housel uses 19 short stories to illustrate how people behave when making money decisions and shows how to think more clearly about your financial journey. By understanding the many pitfalls that can keep you from achieving your financial goals, you will hopefully avoid them and learn how to make wise decisions throughout your financial life.
8. Most importantly, bad sense for the thoughtful investorby Howard Marks
Howard Marks is the co-chairman of Oaktree Capital Management and his quarterly letters have long been widely read in the investment community. Based on these letters, this book identifies the key ways major investors think to achieve excellent returns.
Marks focuses on topics such as risk, identifying bargains, cycles and appreciating the role of luck in investment results. The book will likely stand the test of time and may be a book that investors return to often.
9. The Rental Property Investing Book: How to Create Wealth with Intelligent Real Estate Investingby Brandon Turner
Most people think of the stock market when it comes to investing their money, but it’s not the only game in town. Real estate investing can also build wealth, and its physical nature can sometimes be easier for people to understand than the stock market, which can feel abstract.
In this book, Brandon Turner explains how to make money with rental properties. He will take you through the entire process from buying your first apartment to collecting the rental payments. If you’ve ever wondered how to make money in real estate, this book is a good place to start.
10. The Simple Path to Wealth: Your Roadmap to Financial Independence and a Rich, Free Lifeby J.L. Collins
If you are tired of complicated and confusing explanations of financial issues from so-called experts, then this book is for you. Growing out of a series of letters to Collins’ daughter, this book addresses most of life’s financial problems in a simple, easy-to-understand way. Both new and experienced readers will benefit from the book’s clarity on issues such as debt, the stock market, and wealth building.
Collins emphasizes the importance of understanding your financial life so you don’t get taken advantage of by the “charlatans of the financial world.” Reading this book will likely save you money and increase the likelihood that you will achieve your financial goals.
11. Clever Girl Finance: learn how investing works, grow your moneyby Bola Sukunbi
Women are one of the groups least served by the financial industry, and this book attempts to address that problem by being simple and understandable. There is no attempt to impress readers with complex topics, but it sticks to what you need to know to start investing.
You will learn how the stock market works and also learn important concepts such as inflation, compound interest and the rule of 72. Once you’ve mastered the basics, the book focuses on researching investments and where to make purchases once you’re done. am ready. It’s a great choice for recent graduates and those early in their careers.
12. The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Successby William N. Thorndike Jr.
Many investors think they must identify companies with breakthrough innovation or hyperbolic growth to succeed as an investor, but this book shows how solid companies led by rational CEOs led to excellent long-term returns for their companies’ shareholders.
Thorndike profiles eight CEOs and companies whose stocks dramatically outperformed the S&P 500 during their tenures by focusing on things like share buybacks, prudent acquisitions, and growing shareholder value.
In short
Knowledge is power, especially when it comes to investing. If you’re looking to expand your financial knowledge, or simply pick up tips from some of the top thought leaders in the industry, you can’t go wrong with any of the picks on this list. Or, if audio is more your style, check out our list of the best investing podcasts.
