The Art of Speculation [Paperback]

Philip L. Carret (Author)

Book Description

Publication Date: June 1, 1984

First written in 1924, this is a reprint of the revised 1930 edition and was originally a series of articles written for Barron's. The author was the founder of the Pioneer Fund. Mr. Carret was convinced that speculation is an art rather than a science.

Editorial Reviews

Amazon.com Review

First published in 1930, The Art of Speculation by Philip Carret has long been praised for its perceptive examination of the various ways that speculation impacts the worlds of both business and financial trading. Now, almost seven decades later, a newly updated edition proves as instructive as ever on this and related investment topics such as short selling, government regulation, options, and arbitrage. Chapters on reading a balance sheet and an income statement remain classics. --This text refers to an alternate Paperback edition.

From the Back Cover

"The Art of Speculation is laden with insights and studies that are as fresh today as newly cut grass . . . a joy to read. The topics covered were timeless in 1931 . . . and written in 24-carat prose."
—from the Foreword by Victor Niederhoffer

A classic in every sense of the word, The Art of Speculation has been heralded by investors, both past and present, as a true standout in the field. Written by Philip Carret—a Wall Street legend long considered a leading thinker in basic value investing—this timeless work is as vital a part of finance literature today as it was when it first appeared almost seventy years ago.

Acclaim for The Art of Speculation

"Philip Carret has been practicing the art of investing longer than anyone. In the current frothy stock market environment it is helpful to read his insights into the Great Crash of 1929 to see if there are useful parallels. Beginning investors will find The Art of Speculation instructive and students of the market will learn much about what investing was like seven decades ago before computers, derivatives, junk bonds, discount brokers, and hedge funds. His Twelve Commandments for Speculators is good advice for us all."
—Byron R. Wien, Managing Director/U.S. Investment Strategist Morgan Stanley & Co., Inc.

"A genuine rarity: the intricacies of investing illuminated by clear writing and timeless insight. The chapters on how to read a balance sheet and income statement are classics. No investor should even consider dabbling in the frantic IPO market of today without having read them first."
—Christopher M. Byron Esquire --This text refers to an alternate Paperback edition.

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Product Details

• Paperback: 364 pages
• Publisher: Fraser Publishing Co. (June 1, 1984)
• Language: English
• ISBN-10: 0870340506
• ISBN-13: 978-0870340505
• Product Dimensions: 7.5 x 5.1 x 0.9 inches
• Shipping Weight: 14.4 ounces (View shipping rates and policies)
• Average Customer Review: 3.5 out of 5 stars  See all reviews (8 customer reviews)
• Amazon Best Sellers Rank: #4,052,827 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

17 of 18 people found the following review helpful:

5.0 out of 5 stars An abbreviated Graham & Dodd, January 5, 2002

By 

Georgina "tville" (san francisco, ca) - See all my reviews

This review is from: The Art of Speculation (Wiley Investment Classics) (Paperback)

There is alot to this book that makes the reader think...the beginning chapters on what is speculation and what is gambling, I found invaluable. As a full time trader I needed someone to explain to me why I wasn't just a river boat gambler, or for that matter why all the Brokerage & Banks weren't either, and Mr Carret did beautifully, putting speculation in its proper place in the trade annals of all mankind.
The bulk of the book gives one a short course in Graham & Dodd valuation & why the Internet stocks with no sales/no profits were bound to come to earth (sorry AMZN :-)
Yes he talks about mining and railroads but don't they still exist? Or their counterparts? Railroads are transports; mining is r/d semis and electronics, energy & of course minig. The ideas are the same. Do a little thinking & this book is sheer gold.
I will not say that I overstayed in the valuation parts but I do admit it was good to understand & what to look for whilst reading the various trade papers. Exactly why do profits matter?
Finally, the chapter on volatility...haven't we all been caught in volatility is priceless. It's helped me in my trading immeasurably.
I saw Mr Carret on Lou Rukeyser when he was in his 90's & still working. He impressed me then, vigorous in mind & body, & I was saddened to hear that he died at 101 just 2 years ago. This book like the man, is a time that is lost to all of us & thus with the Internet bubble we were condemned to repeat it.
I wish I had read him earlier. Honestly.
God Bless you Mr Carret & Thanks

15 of 16 people found the following review helpful:

3.0 out of 5 stars Great Information - Difficult to Digest, August 16, 2000

By 

Fred "Technology is your friend." (CHAPEL HILL, NC, United States) - See all my reviews
(REAL NAME)   

This review is from: The Art of Speculation (Wiley Investment Classics) (Paperback)

Mr. Carret was a well-respected financier who spent a lot of time and thought putting to paper the ideas that helped him build a fortune for himself and his clients. The ideas that he writes on, value-investing, market forecasting, evaluating a company's R&D prospects are relevant to this day, and are valuable given the age of the text.

However, this is a somewhat difficult book to read, indeed arguably one of the most difficult to read texts in the Wiley Investment Classic series. With that in mind, I would only suggest it's reading to the dedicated financier who has already digested many of the other fine historical banking books that are available.

Again, this is a good book, but it's wording is old and often not very direct. The graphs and charts need further touching up as they are also somewhat difficult to decipher.

14 of 15 people found the following review helpful:

4.0 out of 5 stars A dry, yet enlightening book on speculative investing, July 28, 2000

By 

Adam F. Jewell (Pittsburgh, PA USA) - See all my reviews
(REAL NAME)   

This review is from: The Art of Speculation (Paperback)

Originally written in the 1930's "The Art of Speculation" examines and explains strategies, tactics, and vehicles for speculating in the financial markets.

The author begins by defining speculation as opposed to investing or gambling. Markets and their inner workings are defined, as well as the stocks, bonds, and other speculative investment opportunities. Several methods for timing the market, utilized at the time of writing are explained and for the most part dismissed, which undoubtedly have parallels in the modern financial world of today.

Forecasting of the financial markets is discussed as well as the methods for increasing leverage, primarily, trading on margin. Strategies for minimizing risk, hedging, shorting, as well as put and call options are examined and discussed in detail. Specific industrial sectors covered include railroad (remember we're back in the 20's and 30's for this book) industrial stocks, utilities, and mining operations. An enlightening discussion of the business and investment potential of oil and mining stocks is presented. It serves to educate the reader on which links in the chain of exploration, development, transportation, processing, and retail sale of these industries are most suited for differing speculative risk tolerances. As we jump ahead 70 years to the markets of 2000, the reader can translate, and apply these analysis to companies occupying comparable positions and strategies in the Dot-Com world, and modern business in general.

If you've got some time to kill, there is plenty of valuable information in this book. It took me a while to get through it, cause frankly it's just not an exciting read. It may very well put you to sleep. If you are simply looking for an intro to investing and getting finances under control, one of the "Dummy" books will be a much better, more practical book to read. Buy this book if you are interested in an historical perspective on speculative investing, which is in many ways applicable to the financial markets of today.