4.0 out of 5 stars By FisherKing on September 21, 2017
Format: Hardcover | Verified Purchase
Fun for the Intended Audience
If you are young and want to work in securities field, you must buy this one. For others, the book is notable both for being heavy weight wise and a departure for books of this type – and that’s a good thing.
*the tone is light and entertaining. The book is obviously directed at a younger (white) urban hip audience, with cute illustrations and step by step instructions which border on the sublime (hair care gets addressed multiple times) with the Beatles, Gordon Gekko, and SNL references galore. This is a pretty big departure both in form and substance from most books of this type and make it even more valuable for that reason. After all, to the uninitiated these topics get dry at times but the authors skillfully skirt the boredom.
*the book is essentially a series of introductory sections in all manner of investment topics, including valuation, competitive advantage, crowd behavior and behavioral finance, and lot of other things besides. As such, it is handy – no more running to this book or that one, but it stands out more as a single source volume which will encourage the reader to move beyond which is a good thing.
*if this matters, the book favors academic valuation over practical ones and thus fosters the typical snob appeal that many value investors hold over other methods of picking stocks. There is, for example, no mention of Peter Lynch or Jim Cramer or Value Line, and if the deep-thinking books from Damodoran or Mauboussin appeal to you then you will love this one. The book reaches a height of this absurdity when it claims that practically all valuation methods equate to discounted cash flow models which even if true becomes absolutely irrelevant (just make money). There is a danger in assuming sophistication and science in what is a a field which where art is a vital component in success, but given the tone in this book many young analysts may adhere to a rigid dogma instead of a more practical process of making sure your picks go up. Yet, this is just a personal quibble and obvious enough to anyone with any experience (short hair does not make a successful stock pick, and some of the managers described are idiots), but it might explain why some oddball profiles on a site like VIC get bad ratings (doesn’t fit the religion) but make tons of money.
All in all, I’d highly recommend this one for the Intended audience, and it should be paired with “Best Practices for Equity Research Analysts” for a very strong foundation before reality sets in and the only thing that matters is beating an index – and attending to your own personal grooming.
P.S. These days, it is hard to take any book seriously in this field without knowing the author’s investment track record (not job title), but this one skirts that issue because a co-author also helped write ‘Gorilla Game’, one of the most important and influential investment books of the past 20 years.
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