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The Little Book of Value Investing, by Christopher H. Browne

One of the benefits of being in the publishing industry is that I sometimes get access to pre-release copies of interesting books. That was the case recently when a co-worker gave me her galley copy of The Little Book of Value Investing. This is the second in the Little Book series. The first book was The Little Book that Beats the Market and I reviewed it here.

Even if my employer, John Wiley & Sons, Inc., weren’t the publisher of this series I’d still be telling you I totally love the approach in this series. Just like the Beats the Market title, the Value Investing one is short and sweet. Even a slow reader like me can get through it in an evening or two. I think every business book should be this short and direct, and I’ve tried to plead my case here.

The Little Book of Value Investing does a fine job explaining the way to find stock values and beat the market. Bargain hunters look for attractively low P/E ratios and/or book values. Although the Value Investing book doesn’t offer the simplicity of the first book’s companion website, it still presents a fairly simple approach to follow.

When I read The Little Book that Beats the Market I was so sold on the strategy that I switched brokers and dumped a lot of tech stocks I had been sitting on for the past 6 years. That was a couple of months ago and I haven’t taken the time to reinvest yet…until yesterday. I finally forged ahead and used the first book’s website to identify some good candidates. I then did some quick research on their history and products so that I’d get to know them better. Finally, I reviewed some of the ratios and other metrics outlined in the Value Investing book and made my first two new investments: Aspreva Pharmaceuticals and Career Education Corp. I plan to pick 8-10 additional companies this way over the next few weeks. Here’s to hoping my picks bear fruit!

Comments

stockmaster

Your account is probably much lower today due to Aspreva Pharmaceuticals. I'd love to show you a strategy that is just as easy as the first little book and then I'd like you to publish it in the third "Little Book".

Joe Wikert

Yes indeed, my balance went down with that Aspreva announcement. Fortunately I'm in this for the long haul, so I'm not dumping or day-trading. I've now bought 7 different stocks using the techniques in these two books and I'm up modestly so far. But, keep in mind I've only been at it for 3 weeks now so it's too early to measure much!

Hendrik Oude Nijhuis

I have read hundreds of books on value investing, Warren Buffett etc, and publish investment tutorials on value investing myself. I highly recommend Greenblatt’s ‘the little book that beats the market’. It could be one of your best investments ever!

Success in investing,
Hendrik Oude Nijhuis
www.magicformulastocks.com

David

How has this worked out for you so far? I picked seven stocks using Little Book last August and have had mixed results. I'm curious to see how you and other fared.

Joe Wikert

Hi David. I'm very happy with my results. I picked 7 different stocks with the magicformulainvesting.com site and am comfortably well into the black. Here's the stock-by-stock results, through market close today:
ASPV, down 19.61% (OK, so there are a few losers...)
CECO, up 72.51% (there, that more than makes up for it!)
BVF, up 65.81%
OVTI, up 5.9%
WON, up 9.9%
ALDA, down 1.47%
GIV, up 55.79%

After reading The Little Book of Value Investing I also put a fair amount of money in the VBINX mutual fund. My original purchase is up 6.12% in a very short period of time, so I just invested in it again late last week.

michael jones

I've read these books and I am really impressed.I believe that this information will help me in my investing.Thank you.

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