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10 Books On Investing That Billionaire Warren Buffett Recommends

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Imitating successful people has its limits. As one brilliant writer on Business Insider once said “The idea that if you can find out how successful people live and then copy it, you’ll be able to emulate it.  Like it was Jack Dorsey’s early morning routine that made Twitter successful. This idea is just not true”. However there are certain instances where imitating successful people can be beneficial. That’s when you study what they know, not just what they do. And what better way to get into what they know than following which books they read right?

One popular avid reader is billionaire investor Warren Buffet. He was once recorded saying in an interview that he reads books to collate more and more and more facts and information, and occasionally seeing whether that leads to some action. He doesn’t read other people’s opinions, he wants to get the facts and information, and then think.  According to Business Insider these are 10 books  that he recommends every aspiring billionaire, like us, should read:

Number 10: ‘The Most Important Thing Illuminated’ by Howard Marks

In this book, Mark aims to help investors achieve success by putting more thought into their decisions, drawing heavily on his own mistakes and what he learned from them. The book lends insight into concepts as “second-level thinking,” the price/value relationship, patient opportunism, and defensive investing. And how did uncle Buffett describe the book? As a rarity!

the most important thing books

Number 9: ‘Jack: Straight from the Gut’ by Jack Welch

The descriptions of Jack Welch have ranged from being the world’s (*cough* cough* America’s) toughest boss to the manager of the century. This is because of how he defied conventional wisdom during his twenty-year career at the helm of General Electric, turning an aging behemoth of a corporation into a lean, mean engine of growth and corporate innovation. Buffett’s advice regarding this book is “Get  copy!”

Welch books

Number 8: ‘The Clash of the Cultures’ by John Bogle

This was one of the  books  recommended by Warren in his 2012 shareholder letter. Written by the founder of the Vanguard Group which now manages upward of $3 trillion in assets, the book argues that long-term investing has been crowded out by short-term speculation. Finishing tips in the book include insights like: what’s hot today isn’t likely to be hot tomorrow: the stock market reverts to fundamental returns over the long run; don’t follow the herd; time is your friend, impulse is your enemy and take advantage of compound interest and don’t be captivated by the siren song of the market.

clash of cultures books

Number 7: ‘Dream Big’ by Cristiane Correa 

The book is an autobiography telling the story of the three Brazilians who founded 3G Capital, an investment firm that joined Buffett in purchasing HJ Heinz in 2013. In the book Correa highlights the main principles of 3G’s management style which paved the way for their current success meritocracy, cost-cutting and trusting in people and allowing their teams work. Buffett liked the book so much that he recommended it at the 2014 Berkshire Hathaway shareholder meeting.

dream big books

Number 6: ‘The Little Book of Common Sense Investing’ by Jack Bogle

This book is another hit by the founder of the Vanguard Group. This book highlights how investing is all about common sense and owning a diversified portfolio of stocks and holding it for the long. Based on his own experience working with Vanguard clients, Bogle attempts to help readers use index investing to build wealth. This book was another recommendation in Buffett’s 2014 shareholder letter. He further recommended that shareholders read this book over listening to the advice of most financial advisers.

common sense books

Number 5: ‘Where Are the Customers’ Yachts?’ by Fred Schwed

Buffet described this book as “The funniest book ever written about investing,” since “it lightly delivers many truly important messages on the subject.” The book was first published in 1940, and takes its title from a story about a visitor to New York who saw the bankers’ and brokers’ yachts and asked where the customers’ were. Obviously, they couldn’t afford them — the people providing the financial advice were in a better position to splurge than the people who followed the advice. The book is said to be filled with scornful wisdom and colorful anecdotes about Wall Street, and remains compelling even today.

yachts books

Number 4: ‘First a Dream’ by Jim Clayton and Bill Retherford

This is one of those books with a captivating “rags to riches” story. Within it, a young boy discovers during the Depression that hard work and sheer perseverance are the keys to living his dreams. It is filled with practical, easy-to-understand, no-nonsense business lessons that the entrepreneur can apply to his or her own life — describing the qualities an effective leader must possess, the key methods to inspiring team members, and the development of culture and values that are critical to the success of a small business as well as a multibillion dollar conglomerate. Buffet liked this autobiography of Clayton so much that he decided to invest in Clayton Homes in 2003.

first a dream books

Number 3: ‘The Essays of Warren Buffett’ by Warren Buffett

What better way is there to learn about how Buffett thinks than to go to the source himself? In this collection, he is said to keep it real — in his signature folksy-intellectual fashion. “What could be more advantageous in an intellectual contest — whether it be chess, bridge, or stock selection — than to have opponents who have been taught that thinking is a waste of energy?” he asks.

essays warren buffett books

Number 2: ‘Security Analysis’ by Benjamin Graham and David L. Dodd

Buffett describes this book as a groundbreaking work of Graham’s that had given him “a road map for investing that I have now been following for 57 years.” The book’s core insight: If your analysis is thorough enough, you can figure out the value of a company — and if the market knows the same. Buffett has said that Graham was the second most influential figure in his life, after only his father. “Ben was this incredible teacher; I mean he was a natural,” he said.

security analysis books

Number 1: ‘The Intelligent Investor’ by Benjamin Graham

This is not only my favorite book by Graham, but the best book on investing that I’ve ever read. Apparently Buffett agrees since when was 19, he picked up a copy of this book and notes this as one of the luckiest moments of his life because it gave him the intellectual framework for investing. “To invest successfully over a lifetime does not require a stratospheric IQ, unusual business insights, or inside information,” Buffett said. “What’s needed is a sound intellectual framework for making decisions and the ability to keep emotions from corroding that framework. This book precisely and clearly prescribes the proper framework. You must provide the emotional discipline.” Buffett liked Graham so much that he named his son after him.

intelligent investor books

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Cecelia Wrights

A Joburg based recent graduate who’s found herself placed in the ambiguous world of corporate life. Next to being one of the freshest additions to the fat slice of the income group cake, called the middle class, she is a Wealth Evangelist on a mission to spread the culture of building wealth amongst those who, like her, are recent graduates early in the stages of building their careers. Sternly believes that money is a bad master, but an excellent slave ;-)!

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