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Today I am going back to the well and giving you a second list of books that have helped to shape me as an analyst. I told you in the inaugural article that I might give you a second list from me, and with two potential interviewees having to put me off this week due to a looming deadline and a vacationing compliance officer I thought this week would be a good time to give you that second list.
For those of you that didn't read the first article, I am Wayne Nef, President of Sniper Research and author of The Sure Shot Letter. I have worked on the Street for over twenty years with stints at Value Line, Merrill Lynch and Circle T Partners. For the past ten years I have worked as a consultant to hedge funds through my company Nef Value Research.
So what's in my library?
A Zebra In Lion Country by Ralph Wanger - This book gives you another look into the mind of a great investor. As the man says right in the beginning of the book "If you've done it, it ain't braggin!" And this man has done it! Wanger had an average annual return of 17.2% for the Acorn Fund from 1970 through 1998. He got there by investing in small cap stocks. This book does a good job of explaining his investment philosophy and gives some good accounts on how he found some of his greatest picks.
Reminiscences of a Stock Operator by Edwin Lefevre - An oldie but a goodie. This book was first published in 1923, yet I don't know many in the business that haven't at least heard of it, if not read it! If you don't read it for the great story, then read it for the great thoughts on crowd psychology or market timing. While some of the stocks mentioned are no longer with us, the set ups that created the opportunities are timeless and you'll think of many instances where the same story has been played out by other stocks in other times. A great book, even today, 90 years after it was first published.
Contrarian Investment Strategies: The Next Generation by David Dreman - Here's another investment master giving away secrets. Dreman is a big believer in psychology and probability. The book focuses in on certain investor behaviors and how to potentially exploit it. A Well-researched read that is also entertaining.
John Neff On Investing by John Neff - Neff is an advocate of low P/E investing. This man is an excellent writer. Not only does he convey his strategy and why it works, but at some points he can make you feel the fear that was driving the market at a given point in time (1973, for example) and how it helped to set up some of his most profitable investment opportunities.
The Devil's Dictionary by Ambrose Bierce - If you are looking for investment advice, you're not going to find it here. Instead this book is a "how to" book on developing cynical wit, which can be useful in our line of business! The Devil's Dictionary gives example after example of Bierce tearing down ideas, notions and people who were considered untouchable in his time. All said, if you want an education on how to be cynical, Ambrose Bierce stands up there along side H.L. Mencken!
As always you can buy any of the books I mentioned at the The Sniper Book Bin. If you'd like to see another great read, sign up for The Sure Shot Letter, my monthly newsletter that is packed full with great investment ideas.