Order The Intelligent Investor, Rev. Ed

The Intelligent Investor is arguably the greatest book ever written on investing. What is unfortunate for this book, however, is that Warren Buffett's ringing endorsement of it makes people think the whole book will teach you to invest like him. This perception is inaccurate. There is a two-pronged theme to "The Intelligent Investor": investment advice for the novice (classified in the book as the "defensive investor") and investment advice for the full-time investor (classified as the "enterprising investor").

The book is hugely valuable for both types, and the advice for the defensive investor is almost a prototype for much of the financial planning advice one receives today. In fact, it is more valuable, since the focus is on lowering volatility and getting income from dividends and interest-- through boom and bust, low inflation and high inflation-- while generally paying much less for advice, since his strategies suggest there should low turnover in your portfolio.

What most people read the book for, however, is for the information on becoming a better-than-average investor. I have heard Buffett say that Chapters 8 and 20 are the best chapters written in investing history, and I believe he is right. Chapter 8 is especially important, as it discusses in very broad outlines how to value a company and when the price may be right for a purchase. These concepts are fleshed out in tremendous detail in Security Analysis, but Chapter 8 is the best place to start.

Lastly, the writing in this book can be very dry. Hopefully, setting the context here may offset some of that. If it is not good enough, though, I would strongly recommend picking up the reprint of the fist edition: the writing is MUCH smoother in that edition. Interestingly, the first edition is much smaller, which suggests the book suffered from overediting as the years went by.

Hope this helps. The book really does deserve all of the praise it gets. You just need to know the context.Get more detail about The Intelligent Investor, Rev. Ed.