Investing much like any other activity is dependent on the tools you use. You can start fishing with a string or hunting with a rock but your success will be severally limited if you do that. The same is true for investing.
In investing the tool you use is your knowledge inventory, the bigger it is the more likely your success will be. From my own inventory these are some of the most useful books i can recommend.
Investing for Dummies
There are many iterations of this book and they do a good job presenting the market to a new investor. Very much a bare bones minimum investment book. Great for those who know NOTHING about investing and investment types. Good reading book either way
The Intelligent Investor
A book that guided the investing career of the most famous investor of all times Warren Buffet. An eternal classic. It is not a book that promises ‘How to become rich…’ or ‘Mastering Stock market in a week….’ or ‘Beating the market made easy…’ . The book teaches three powerful lessons of how one can:
– minimize the odds of suffering irreversible losses
– maximize the chance of achieving sustainable gains
– practice emotional control and behavior to help the investor achieve full potential.
Technical Analysis of Financial Markets
The bible of technical analysis, it explains a large part of the tools you can use and why you might need to use them. Creeping up on 20 years old and just as relevant today as ever, it does not disappoint. The methods are timeless and presented clearly with examples and graphics. Excellent book to keep handy while placing trades as a beginner.
Elliott Wave Principle: A Key to Market Behavior
Much like Dow theory it tries to define the repetitive structure of a market. Most advise we get on investing runs along the lines of “buy low, sell high.” But how do you know if a price is relatively low or high? The answer lies in your ability to decipher human behavior and its relation to market dynamics. As it turns out, the mood of market making has a cycle that can be identified and studied. This book won’t tell you what to buy and when, but it will help you determine suitable situations where the odds of being right will be in your favor.
Japanese Candlestick Charting Techniques
It is the authoritative reference on candlestick charting, and required reading for the CMT exam. The author does an outstanding job of demystifying the names and patterns of the Japanese technique. He ties them to market psychology – always important in charting – and their Western counterparts. Also covers basic TA like oscillators, divergence, etc.