20 Best Stock Trading Books for 2023
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There are many stock trading books out there that can help new investors expand their stock education. This list highlights 20 top stock market books every trader should read. Many of the titles promise the moon and the stars. I’m sorry to say not one of these books in isolation will make you an instant billionaire (sorry), but this collection can serve as a foundation for the market wisdom you will pick up with experience.
1. A Random Walk Down Wall Street
Currently in its thirteenth edition, this book deserves much of the credit for the growth of index ETFs and passive investing in general. It’s a fantastic read for people interested in the question of whether markets can be predicted and comes to some startling (and hotly debated) conclusions. Indexing, diversification, trends, bubbles, the value of patience coupled with time, and many more core concepts are covered in thorough detail.
2. The Little Book of Common Sense Investing
John Bogle founded the Vanguard Group, known for providing the lowest cost funds in the industry, specifically the very first index fund. Jack's message is simple: Keep costs low and invest in market indexes for the long run. Jack's other book, Common Sense on Mutual Funds, is another bestseller and breaks down mutual fund investing. Another great book with a similar message can be found in Jeremy Siegel's Stocks for the Long Run.
3. How to Make Money in Stocks
This is a classic by William O'Neil that details the ins and outs of his “CANSLIM” system for finding future big winners in the stock market and how to time entries and exits. It combines fundamental and technical analysis and is one of the best how-to-guides for stock investing.
4. The Most Important Thing Illuminated: Uncommon Sense for the Thoughtful Investor
Using his Oaktree Capital client memos as a foundation, Howard assembled a collection of the 21 most important things to know about investing. The book introduces multiple keys to long-term success including, "second-level thinking," the price/value relationship, patient opportunism, and defensive investing.
5. Reminiscences of a Stock Operator
This book is a true page-turner. It is a breathtaking recount of how a young boy managed to amass one of the largest fortunes of his time by speculating, even though he did go broke a few times in his career. Though this book describes how people traded in a bygone era, there is some timeless advice for investors (“I've always made my money from sitting, not thinking") which will help your trading for years to come. It’s one of the top stock trading books of all time. Yes, I said that.
6. Buffett: The Making of an American Capitalist
This book conveys insight into the ways and means of the Oracle of Omaha. Warren Buffett's thoughts are insightful and his methods may yield fruitful rewards for investors with enough patience to learn them, understand them and apply them correctly.
7. Intermarket Analysis: Profiting from Global Market Relationships
According to the author, financial markets are interrelated, so your forecasts need to account for how other markets are faring. For example, bond prices are linked with stock prices, and petroleum prices will certainly affect the airline sector. This book provides a framework for taking the biggest of big-picture views of the markets.
8. Trade Your Way to Financial Freedom
Don’t dismiss this book because of its over-the-top title. This is a gem that encompasses investor psychology and system construction. While it may not give you the "Holy Grail" (an unbeatable method to the markets) for trading, it will give you the basics you need to construct a winning system. There is something for everyone in this book.
9. The Intelligent Investor
The foundation for value investing and being successful in the market, Benjamin Graham's classic has sold over 1 million copies and deserves a spot on every investors' bookshelf. Let’s put it this way: When Warren Buffett writes an introduction to a book, it’s worth reading.
10. One Up on Wall Street
This is an investment classic that will give the individual investor hope of beating the big players. Peter Lynch explains how Wall Street may not be able to find the best investing opportunities from the start and shows step-by-step how the individual investor can find the next winner.
11. The Little Book That Still Beats the Market
This book covers the basic principles of investing in the stock market. It breaks down the author's proven "magic formula investing" method of outperforming the market by investing in quality companies at discounted prices. The quotation marks are there because there isn’t a “magic formula” for beating the market, but there are some key principles of value investing that every investor should know.
12. Liar's Poker
An interesting, though perhaps not profitable, narrative of how Wall Street works, or at least did in the Eighties. It’s so good that I reread it every few years. Just remember that in the Eighties, a million or billion dollars was a lot of money.
13. Fooled by Randomness
This book, which would go well with "The Black Swan," explains how randomness plays a larger role in our lives than we might think. For traders, this would imply that risks are usually larger than we might perceive.
14. Alchemy of Finance
Alchemy of Finance explain's the author's theory of reflexivity and how it relates to the market. Though it may not provide a direct system for trading, it is extremely thoughtful and deepens one's understanding of how the financial markets work. The book may be a bit dense but it is rewarding for those who are willing to finish it.
15. Japanese Candlestick Charting Techniques
This book introduces candlestick charting, which some investors may find useful in their trading. It sure helps to make charts more visual!
16. Extraordinary Popular Delusions and the Madness of Crowds
This is also an investing classic. Tulipomania, the South Sea bubble and the Mississippi Land scheme are covered in this book, showing how herd mentality worked to create bubbles in past eras. It may serve as an interesting read as well as a guide for dealing with future bubbles.
17. Common Stocks and Uncommon Profits
Warren Buffett credits Phillip Fisher with much of his success. In the age of quantitative finance, this book is a must-read for those who want to understand how to evaluate a company away from the raw numbers. The poignant introduction to the latest edition by Phillip Fisher’s son, Kenneth, is worth the price of admission on its own.
18. Irrational Exuberance
One of the best stock market books in history treats stocks and other investment assets the same way as tulips and Beanie Babies. As the winner of the 2013 Nobel Prize in Economics, Robert Shiller understands the markets and has spent his career studying their movements. Irrational Exuberance explores how trends turn into booms and ultimately bubbles that burst.
19. Technical Analysis Explained, Fifth Edition: The Successful Investor's Guide to Spotting Investment Trends and Turning Points
A scintillating narrative of how one of the darlings of the hedge fund world rose and how it fell. A reminder for traders to keep their minds focused on risk and their circle of competence.
20. Encyclopedia of Chart Patterns
An extremely detailed work that rivals "Technical Analysis of Stock Trends" and should provide traders with a complete understanding of chart patterns. The hard work is to apply the knowledge.
What is the best book to learn about the stock market?
Stock Investing for Dummies is an excellent choice for beginners. It covers all the necessary information to get started and organizes it well enough for you to find information quickly when you’re stumped.
What is the best book to read on stock trading?
The best single book on stock trading is Martin Pring’s Technical Analysis Explained. It explains complicated trading concepts using simple analogies that are easy to follow.
What books do professional traders read?
Most professional traders will agree with this list:
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- 20 Best Stock Trading Books
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- Why Day Trading is a Loser's Game
- How to Invest (Beginner's Guide)