The Neatest Little Guide to Stock Market Investing, 2010 Edition [Paperback]

Jason Kelly (Author)

Book Description

Release date: December 29, 2009

Read Jason Kelly's posts on the Penguin Blog

The essential stock market guide updated with timely strategies for investing after the crash

Now in its fourth edition, Jason Kelly's The Neatest Little Guide to Stock Market Investing has established itself as a clear, concise, and highly effective guide for investing in stocks. This comprehensively updated edition contains tried-and-true investment principles to teach investors how to create and refine a profitable investment program. New strategies and content include:

•Basic tips on when to invest and how to reduce the amount of risk in this turbulent market
•A new core portfolio technique that shows readers a way to achieve 3 percent quarterly performance with the IJR exchange-traded fund
•An exclusive interview with legendary Legg Mason investment counselor, Bill Miller, including his thoughts on the financial crash of 2008

Accessible and intelligent, The Neatest Little Guide to Stock Market Investing is what every investor needs to keep pace in the current market.

Editorial Reviews

Review

From the Author

Reader reviews displayed below apply only to this 2010 edition. If you'd like to see the hundreds of reader reviews from prior editions, please go to their pages at Amazon.

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Product Details

• Paperback: 320 pages
• Publisher: Plume; Revised edition (December 29, 2009)
• Language: English
• ISBN-10: 0452295823
• ISBN-13: 978-0452295827
• Product Dimensions: 7.9 x 5.3 x 0.7 inches
• Shipping Weight: 11.2 ounces
• Average Customer Review: 4.6 out of 5 stars  See all reviews (101 customer reviews)
• Amazon Best Sellers Rank: #89,111 in Books (See Top 100 in Books)

More About the Author

Jason Kelly is the author of nine books including "The Neatest Little Guide to Stock Market Investing," a BusinessWeek best seller now in its 2013 edition, and its companion volume, "Stock Market Contest." He also publishes "The Kelly Letter," providing subscribers with a clear look at financial markets every Sunday morning.

He graduated from the University of Colorado in 1993 with a BA in English, but not before a professor told him that he would never succeed as an author because he "lacked a basic command of the English language." Luckily, IBM disagreed and hired Jason as a technical writer at its Silicon Valley Laboratory in San Jose, California. Once income from his freelance writing matched his income from IBM, Jason left corporate life to become a full-time freelance writer. About IBM hiring him for the only "real" job he's ever had, Jason wrote in his book "Financially Stupid People," "I keep a special smile for Big Blue because of that break. It was the only company that believed in me. I never knew the meaning of the term 'competing offer.'"

One of Jason's Japanese publishers, Shueisha, brought him to Tokyo on book tour in 1999. He took that opportunity to visit his old high school exchange student friend, and wrote a funny article about the experience. That article remains one of Jason's most widely read. It's still on his site, at http://is.gd/cLe5V. Japan went straight to Jason's heart, and he decided to live there. He rented out his home in California and moved to Sano, Japan in 2002 for what he thought was going to be a one-year stay. This many years later, he still lives and works there.

After the March 2011 earthquake and tsunami, he founded Socks for Japan, a volunteer organization that hand-delivered 160,000 care packages from around the world to survivors. See photos and read reports about the effort at socksforjapan.com.

In addition to writing new books and "The Kelly Letter," he's also the angel investor in Red Frog Coffee in Longmont, Colorado, a delightful little shop managed by his sister and business partner, Emily. He divides his time between Japan and his cabin in the Rocky Mountains.

Learn all you could ever want to know about Jason at jasonkelly.com/about.

Most Helpful Customer Reviews

145 of 148 people found the following review helpful

5.0 out of 5 stars One of the best books for Trading and Investing February 20, 2010

By Zachary Hughes

Format:Paperback|Amazon Verified Purchase

This book is a great book for anyone looking to invest money in the stock market. I have read many investment books and stock trading books and this is one of only 3 books that I would advise a new trader or investor to read.

The author, Jason Kelly, starts by explaining "Why Stocks are Good Investments". Jason points to strong and true facts that show that owning stocks is one of the best ways of increasing wealth over time. He explains how you make money in stocks and goes into the difference between "total return" and "capital appreciation". Jason then explains why companies even sell stocks and how that works. If you are new to stock investing or trading and you do not have a clear understanding of this then you should read this. There is a quick section also about how to choose a broker to help you buy and sell stocks.

Jason then goes into "How to Evaluate Stocks". He explains the difference between value and growth investing. Jason does a great job of defining and explaining all of the most common terms in evaluating the fundamentals of companies including: current ratio, EPS, ROE, Net Profit Margin, P/E, and P/S. Then he explains common terms for evaluating the technicals of the stock price including: SMA, MACD, RSI, relative price strength, and volume. Knowing and understanding these terms is a must for anyone who wants to invest or trade in individual stocks.

After reading the 1st 3 chapters you will know half the things they teach you in a 4 year Business Degree. Believe me, I have a degree in Business.

Then Jason tells you "How the Masters Tell Us to Invest". Here he summarizes how each of the best traders and investors of all time advise individuals to build wealth.... He covers Benjamin Graham, Phillip Fisher, Warren Buffet, Peter Lynch, William O'Neil, and Bill Miller. You could read whole books about each one of these investors or you could just read these sections in Jason's book where he breaks down their main points. Jason then has a section where he finds the common points that all these investors share called "Where the Masters Agree". This section will be the backbone for the strategy of the author.

Jason then explains "How History Tells Us to Invest". Here Jason explains some backtesting on various investing methods and shows that combining Value and Growth Investing is one of the best ways to build wealth over time.

Then we get into the real meat of the book. Section 4 "Permanent Portfolios" introduces you to easy to follow strategies to beat the market over time. This is where both new and experienced investors who have not read this book before will be able to really benefit by reading this. If you are someone who wants to beat the market by only looking at and adjusting your portfolio for a few short minutes about 4 times a year then these strategies are for you.

Jason also has the most exhaustive list of resources for stock research I have ever come across. When you read "Research to Riches" section you will have a gateway to all the best data on stocks available through many many sources.

In "This Books Strategy" Jason explains how we will use the "Permanent Portfolio" to build our fortress of wealth and then create and maintain a watch-list of individual stocks that we will send out of our fortress of wealth when the time is right to bring back even higher returns. Jason thoroughly explains how and where to gather information and compare it to stocks you already have on your list so that you are not overwhelmed by all the data and stock gurus available. Jason explains when may be good times to buy and when may be good times to sell stocks. He also has a very interesting way of tracking your performance and reviewing your choices to learn from the past.

And of course he has an investment website and "Letter" to compliment what we have learned in this book. The website is a great way to read his recent observations which he updates with new articles on a regular basis and is available to anyone for free. And he has the "Letter" which is a very affordable service (about $5.35/month I think) where he emails members on updates of his portfolios and his view of the market direction. I recommend at the very least to check it out on his website where you can find a sample "Letter" and see how his portfolios have performed against the "market". Read more ›

63 of 65 people found the following review helpful

5.0 out of 5 stars WHY this book is for you- regardless June 14, 2010

By Spiritgide

Format:Paperback

I see a one-star review here that says this book is for neophyte investors. Yes, it is! It's also for experienced investors. I have 400% in total portfolio gains over the last two years. I'm not inexperienced- and I find substantial value in this new book, as I did in his earlier one that helped me learn my investment strategy.

Occasionally someone will ask how I managed to achieve such gains in a recession, and I tell them how I follow fundamentals- value, potential, risk assessment, and so on. I'm amazed at the number of people who think that's crude strategy... but yet to find such a person who has done as well.

One of the reasons some "experienced" investors don't do as well as they should is that they forget the fundamentals, or start believing fundamentals are negotiable or don't apply to them because of their accumulated wisdom. Experience can get in the way if you start thinking that doing something for several years automatically makes you good at it, even when your gains are say you're not. Hogwash can get in the way too, and the investment world has plenty of that. It hides the important stuff, and distracts investors from what really makes the differences.

Jason is one of the very few investment writers who is clear and concise, and never loses sight of the fundamentals of investing. No hogwash! He gets to the point clearly and concisely without adding copy designed to impress or confound you with his wizardry. His books are actually designed to help investors understand and profit... while most books are designed to sell, and make the author profit. Don't expect the fancy stuff, the confusing techno-babble. Expect the core information that allows you to understand and remember the fundamentals, to grow and become better and better.... One of the best investment bucks you will ever spend. Read more ›

24 of 24 people found the following review helpful

4.0 out of 5 stars Good for basic investing information February 18, 2010

By Bruce Heaton

Format:Paperback

This book provides a good basic education on stock investing. So if you are a beginner it is worth the read, if on the other hand you are already investing or trading skip to more advanced books.

In the section on evaluating stocks the author advocates using classical measurements such as PE ratios, price/book etc. My experience has shown that PE ratios are not the cause of a stock performance but the result of it. That is, stocks already experiencing high growth tend to have high PE ratios and if you used PE ratios as one of your criteria you would have missed the best stocks in recent years. I have found that a combination of stock holders equity and retained earnings is a better measure of future performance. A steady increase in stockholders equity with 15% year over year growth in retained earnings is usually a better indication of future price advance.

I was somewhat disappointed with the lack of depth in the section on technical analysis . These days holding times for stocks are becoming much shorter making technical analysis a major part of an investors decision on timing a stocks purchase.
A major part of the book lists resources for investing. In my opinion this was somewhat of an overkill since these resources can be easily found just by doing a simple internet search.
You can learn some basic investing information from this book but before acting on any specific stocks, I will be sure to read other more advanced books first.

11 of 11 people found the following review helpful

5.0 out of 5 stars Fan-tastic!!!! December 25, 2010

By K. R.

Format:Paperback|Amazon Verified Purchase

I would consider myself as an investing/stock market "beginner".

That being said, I read this book in 2 days. Mr. Kelley lays everything out in a way that is easy to understand for those of us who aren't affluent to all the market lingo. Once I got started, I wasn't overwhelmed with complex terms or formulas. I found myself not wanting to put the book down because I was learning something new and personally applicable after each page.

There are 8 sections to this book:
1. Speak the language of stocks - in this section the basics are discussed ranging from what the stock market is, basic terminology and valuation, why to invest and how to evaluate stock.
2. How the masters tell us to invest - this section breaks down the philosophies (in everyday, normal language) of greats Graham, Fisher, Buffett, Lynch and O Neil. You'll be amazed at how simple their investing outlook is)
3. How history tells us to invest - this section takes a few of the critical basics from section 1 and expands on their importance. It also delves into value and growth investing and how to use both to your advantage
4. Permanent portfolios - this is my favorite section. It gives a few strategic examples on how to invest in regards to the dow without having to research hundreds of stocks. The results are broken down by year and performance. I think this is very useful to the investor that is still a little intimidated by trading his/her own individual stocks and wants a guideline ot template to use.
5. Get ready to invest - this section gets you ready to pick a brokerage and get started. It contains a lot of info you probably know, but some you didnt
6. Research the riches - this section shows numerous ways and places to find stock data and how to use it
7.... The books strategy - this section details Jason Kelley's "stocks to watch" worksheet column by column. It also taps on how to react to market fluctuations and how or when to sell
8. Bon voyage - this section cotnains appendices and a quick summarization of each section. Very helpful when you need to go back and research something from the book.

I haven't read too many of these types of books but I think I picked a great one from the start. I don't consider myself ready to go out and invest my life savings after reading this but I did feel confident enough to use a few of the dow related strategies Jason mentions in section 4.

I highly recommend this book for the beginner to average investor. Read more ›