How would the world’s number one investor and billionaire Warren Buffett get all his wisdom? Particularly, by reading a lot: he spends 80% of his day reading.
We searched interviews and letters to investors to find out which books Buffett advises to others. We show you nine book recommendations by Warren Buffett.
1. The Intelligent Investor – Benjamin Graham
This book is written by the teacher of Warren Buffett, Benjamin Graham. Buffett learned from this book that successful investing does not requires a high IQ, business insight or foreknowledge. What is needed (to be a good investor), is a good intellectual scheme for making decisions, and the ability to control your emotions.
2. Security Analysis – Benjamin Graham
If your analysis of a listed company is good enough, then you know the underlying value of the company. That’s what this book is about (it discusses other concepts as well). Buffett says this book is his guide for investing and he has used it for 57 years.
3. Common Stocks and Uncommon Profits – Philip Fisher
Author Fisher emphasizes in this book that focusing on financial statements of companies is not sufficient to assess companies. Investors should also examine the management. Buffett says he reads everything what Philip says.
4. Stress Test – Timothy Geithner
Tim Geithner was the US Treasury Secretary during the financial crisis of 2008. The former minister writes in his book about leading his department during the crisis. Buffett argued that this book is a must for every manager.
5. The Essays of Warren Buffett – Warren Buffett
The letters Warren Buffett to the shareholders of his company Berkshire Hathaway are read by millions of investors and every word from those letters is carefully interpreted.
In his letters, he explains how his company operates and discloses his investment philosophy. Warren Buffett’s letters are like pearls to anyone interested in investing. They are compiled in this book.
6. Jack Welch: Straight from the Gut – Jack Welch
This biography tells how Jack Welch climbed the ladder: he came from the working class, but became CEO of General Electric, one of the biggest companies in the world. Welch is seen by many as one of the best CEOs ever. Buffett describes Welch as smart, energetic, and hands-on.
7. The Outsiders – William Thorndike, Jr.
In this book by Thorndike the successful agreements of executives described at companies like The Washington Post and Purina are described. Buffett calls it an excellent book about CEOs who excelled in investing money where yielded the most.
8. The Clash of the Cultures – John Bogles
John Bogles is the founder of the Vanguard Group, which offers investment products to (private) investors. In this book, he argues that many more people speculate than they invest for the long term. Warren Buffett recommended this book to shareholders in his letter of 2012.
9. Business Adventures – John Brooks
Warren Buffett once sent Bill Gates, founder of Microsoft, a copy of this book when Gates asked him about his favourite book. It is a collection of twelve classic stories from the world of finance that have appeared in the newspaper The New Yorker.
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