The 4 Investing Books that Changed My Life (and still guide me today)

Transcript

  I was listening to my pastor the other day and he was talking about looking around you and, and just realizing that where you are right now, at one point in in your life, you probably prayed to be at this particular point in this moment in time. And I started to think back and I was like, you know what? That's right.

So I started looking around, I was looking through my office and looking through my books and I was reflecting back, you know, 30 years ago when I was finishing college and really thinking about all my passions of what I wanted to do, and I just love stocks. I just love the stock market.

So I was laughing at myself because I used to walk around with the stock newspaper everywhere that I want. So I would go before parties. I would be reading the stock newspaper, waiting for things to start at the party in college. And then I used to be a pharmaceutical representative, and I used to walk around with stacks of stock books, and I used to go on vacations and bring on my stock books and sit on the beach and read through my stock books. So I was looking back through some of the, the books that I used to read and some of my favorite books and some of the first books that I read. So if you have young people that are interested in stocks or you're interested in stocks, here's some of my favorite books that I read about stocks and how I started to really learn about the stock market and from some of these books

First one was, was One Up On Wall Street. So I probably read this, this book is old, this book's from the eighties, so I probably read this, uh, latter part of high school, I guess maybe early college. So it's, it's really a common sense approach to investing. So it's like, look around you, um, what are your kids talking about? What are, what are your, what's your spouse talking about? Where are people spending their money? Maybe there's an opportunity there. Maybe you can start to do some more research around that. So if there's a store that you're going into a lot or, or product that your kids are talking about, maybe there's a publicly traded stock and a way that you can capitalize on that. And that was kind of a basic concept, but I learned that from this book. This is one of the first ones that I read. So, um, and all these books, you can see all, all the highlights.

I used to have all, everything highlighted, all.

Here's another one of my, my old favorites. This is the Warren Buffet Way, and I wanted to learn all the secrets of Warren Buffet. This wasn't even written by Warren Buffet. This was written by, uh, Robert Hagstrom Jr. But, um, I used to go through here and highlight all the pages and put all my notes in the margins and everything and one of the main things I remember learning from this book was the concept of operational leverage that you, you don't wanna invest in companies that are super capital intensive. Like, um, I remember thinking, you know, an airline may not be the best business long term because it's, it requires so much money, so much capital to be able to, uh, make money over time.

And every time you introduce a new fleet of airplanes, you have to spend a lot of money to make money. But companies where with a lot of operational leverage or companies where you make a big investment one time and then you can scale the revenue based on that initial investment. For example, if you invest in a bunch of software so that you could do an analysis for business clients, right? Now, you made that initial investment in a lot of very expensive software, but the more clients you get, you don't have to buy more software to service these clients, so you've already made the investment and you can scale and leverage that initial investment. Those are really great companies longer term typically. So the whole concept of having a strong return on capital, I learned from this book. So this is one of my favorite old books that I read, as well.

Now, the stuff I learned in this book, How To Make Money In Stocks by William J. O'Neill, this book, is my favorite stock book of all time. This, this book, I still use the tenets that I learned in this book today, right now. And, um, I mean I paid what, 19 bucks for this book, I guess 30 years ago and I may need to send William J. O'Neill a check because the stuff I learned from this book has just been instrumental in how I invest. So one of the main things that I've learned is the supply and demand concept of stock. So if you're thinking in terms of a stock like a business that's a good way to approach it at the base level, but because you're trading in an open market with instant liquidity, every day you can hit a button and get in or out of your stock. That dynamic changes how you need to view a stock and you and I are probably not moving a stock, right? We're not investing enough in a stock to move it up or down, but when these institutions come in and decide they wanna buy a stock, pension funds, um, mutual funds; these large institutions- they have enough demand or supply to move that stock up or down. So you need to be aware of that supply flow and figure out ways to try to get in front of it or participate alongside of it. So looking at charts, the technical analysis that goes with stocks, in addition to the fundamental analysis around the business model and the management and the earnings, et cetera, you need to combine the two together to really be effective when you're investing in stocks and I learned that from this book. This book is excellent. So, um, I actually have several versions of this book, but I think this was the first one. And this one, I mean, yeah, I used to have, uh, I used to be all up in the margins on this book. I, yeah, I used to, I love this book. This is one of my favorite books ever. Uh, how to Make Money in Stocks.

Now this book right here is official. This is Reminiscences- Reminiscences of a Stock Operator and this is- it's a fictional book, but it's about an actual trader from like a hundred years ago. Jesse Livermore is one of the most famous traders ever, and this is a book about his life and about his trading philosophy. He took copious very detailed notes about how we thought about stocks and he, I mean, he's the old school stock market where, you know, they were writing stuff up on the chalkboard and he would come in and, and talk about how he was able to use the sentiment of the crowd against them and use that to his advantage when he was trading stock. I mean, Jesse Livermore made lost and remade fortunes a couple of different times in his life. I mean he was the real deal and this brings everything together. So all that I learned from those other books, when I read this book, I read this a little later, I was probably about 10 years into trading when I read this book, and it just was, even though it was based back in the early 19 hundreds, the human nature does not change, right? So this is all about understanding the emotions of other people and how you can use it to your advantage. The emotions of people participating in the stock market, how you can use it to your advantage. This book is great, so, and is well written and it's a very interesting story and I learned a lot about stock market history because it was based in the early 19 hundreds. So this is also one of my favorite stock books, uh, from, uh, Edwin Lefevre- however you pronounce that.

So this is Antwone Harris with Platinum Bridge Wealth Strategies, and I'll talk to you soon.