What did you learn about investing this year? Did it help? Unless you’re a day-trading pro, your investment acumen is likely parsed from financial pros altruistic enough to share their wisdom online. But with so many of those ‘pros’ out there, picking a source can be just as tricky as picking stocks.

For the fourth day of Giftmas, we’re trying to solve part of the education puzzle for you. We reached out to some high-profile finance gurus in our network and hit them with one question:

What one book have you read that taught you the most about investing?

Those we contacted are industry heavyweights, educational thought leaders, and established share traders. And good thing for you, we’re giving all of their favourite the books away.

We want to pepper you with books because the online ‘attention economy’ isn’t always conducive to enduring learnings. You can follow as many daily updates (and blogs ran by investment platforms) as you like, but nothing sticks with you like a good book. Not to mention that the best investment learnings don’t always come from the finance sphere.

Putting time aside to educate yourself is what financial investing is all about: using what you’ve got today to make a better you tomorrow. If you want to do just that, then you’ve got to do a couple of things to get involved:

  1. Read this post (yep, it’s a reading competition)
  2. Head to our 12 Days of Giftmas landing page
  3. Submit to your answer to the following question, using the form under Day Four

Which of these books is rumoured to get its own Netflix series?

Happy reading!

 

Kate Campbell | Host of The Australian Finance Podcast

Book: Shareplicity (1 & 2) by Danielle Ecuyer

I really enjoyed Shareplicity (1 & 2) by Danielle Ecuyer, who I’ve had the pleasure of speaking to a number of times now. It’s rare to find an Aussie investing book focused on shares, and even rarer to find one by a kickass female author and expert in her own right. From strategies investors can use to research new companies to the common errors new investors make, Danielle provides a concise overview on investing in Australian companies. If you’re keen to learn more about investing in companies on the ASX and US markets, these are the books for you!

 

Andrew Ward | Founder, SelfWealth

Books: The Contrarian — Peter Thiel and Silicon Valley’s Pursuit of Power by Max Chafkin.

This was the most enlightening book I read in 2021.  Recommended by a podcast, I bought it immediately and read it in two days. Peter Thiel as an investor is an enigma and someone I never really understood – I still don’t. As one of the Founders of PayPal and Palantir, and the first outside investor in Facebook, he certainly picks more winners than losers. His mantra is similar to Warren Buffet’s – “Be fearful when others are greedy and greedy when others are fearful” – and this sums up his approach to investing in businesses when it at first seems counter-intuitive to do so. He invests early and backs people he understands well – Elon Musk (ex Paypal & Tesla/SpaceX) and Randy Hoffman (ex PayPal & LinkedIn), and there’s a valuable learning from that for SelfWealth members.

 

Danielle Ecuyer | Creator and Founder of Shareplicity

Book: Net Positive: How Courageous Companies Thrive by Giving More Than They Take by Andrew S. Winston and Paul Polman

This is my Christmas present to myself. Written by the former CEO of Unilever (2009-2019), Paul Polman, who “has been described by The Financial Times as ‘a standout CEO of the past decade’, and Andrew Winston who is one of the world’s leading thinkers on sustainable business”. The greatest challenge for investors is the changing world and the shift to manage climate change risks, carbon mitigation and becoming more sustainable. As investors, these themes are important to understand and I believe this book will go a long way to helping you appreciate what factors make a great company that can adjust and rise to major 21st Century challenges.

 

Andrew Page | Founder and Managing Director, Strawman.com

Book: The Gorilla Game — Picking Winners in High Technology by Geoffrey Moore, Paul Johnson, and Tom Kippola

This is a book I first read years ago, and has been foundational to my investing approach. So much so that I try to re-read it every few years. The insights and lessons for technology focused investors are, in my view, timeless.

Although the book was first published in 1998 — well before the explosion in technology stocks as we know them — the characteristics of ‘Gorilla stocks’, and the advantages they afford investors remain relevant to this day. In essence, a Gorilla stock is one that dominates its industry, has significant competitive advantages, and enjoys very favourable economics.

A good example on the ASX would be REA Group (ASX:REA) — a company that displaced traditional print classifieds to become the dominant industry player. In doing so, it has grown revenues from less than $4 million in 2001, to over $1 billion today. Early investors have done incredibly well: $1000 invested in REA Group 20 years ago is today worth almost $1 million, a 1000x return (excluding dividends!).

That’s the power of Gorilla game investing.

 

Owen Rask | Analyst and Founder of Rask Media

Book: The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness by Morgan Housel

One of Kate and my favourite books of all time is The Psychology of Money. Kate and I were ecstatic to have the opportunity to speak to author Morgan Housel earlier this year on The Australian Finance Podcast about the ways human psychology plays a role in our money management and investing.
The Psychology of Money provides a perfect complement to something like The Barefoot Investor because it talks about the stories and ideas behind money and investing, giving you new ways to think about your relationship and history with money, and the reasons you invest. Morgan says, “wealth is invisible” (it’s all of the things you can’t see) and “being good with money has less to do with how smart you are and more to do with how you behave”. The same could be said about investing.
Whether you’re an active stock picker (like me) or ETF investor (also like me), the book is a fantastic read. It helped me identify the true reason I invest in shares or ETFs, and the value of money. This ‘stocking stuffer’ has already sold one million copies and I heard it’s about to be made into a Netflix series!