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The Art of Value Investing: How the World's Best Investors Beat the Market Hardcover – April 29, 2013
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“John Heins and Whitney Tilson, co-founders of the Value Investor Insight newsletter, have done a thorough job of explaining how to look for stocks that are trading at significant discounts to what they are worth — the concept known as the value style of investing.…the authors present a clear framework for ferreting out undervalued companies.”
—The New York Times
“[The Art of Value Investing] is packed with invaluable insights and is relevant to both the novice and the experienced investor. …This book provides a valuable contribution to the industry literature on value investing. It is well written, well organized, and quite enjoyable. The Art of Value Investing should be read by all investors who are seriously interested in enhancing their understanding of this important field.”
—CFA Institute Book Review
From the Inside Flap
You know what value investing is: it's how Warren Buffett made his billions. Perhaps you're even familiar with value investing terminology, such as margin of safety and intrinsic value. And maybe you've already found success with value investing and know from experience that it's the most reliable way to achieve market-beating returns and accumulate significant wealth. Congratulations!
Whether you're a complete beginner in need of an A-to-Z value investing primer, an experienced investor looking to expand and fine-tune your repertoire of value investing skills, or an individual or institutional investor looking to identify the best money managers, this book is for you. In writing it, authors John Heins and Whitney Tilson have achieved a remarkable feat: They've brought together the collective wisdom of today's most successful value investors and distilled it into a series of actionable lessons you can put into practice right away.
Based on extensive interviews with market-beating money managers, superstar hedge fund managers and mutual fund heroes, and featuring many real-world examples, The Art of Value Investing expertly describes:
- The philosophies behind today's most successful value investing strategies
- The key skills top market-beaters think of as absolutely indispensable to success
- The types of situations and market inefficiencies value investor legends look to exploit
- How top value investors generate new investing ideas
- How to research companies, with insights on company valuation and deciding what and when to buy
- How the best value investors maintain mental and emotional discipline
- How value investing superstars learn from their mistakes and the key lessons they've learned
- Portfolio management techniques, including guidance on diversification, risk management, position-sizing, and more
But The Art of Value Investing does much more than impart information. It was designed to help you develop an approach to value investing that's just right for you.
Sit ten or a dozen of the most successful practitioners down in a room and you're likely to get as many opinions on which value investment flavor is best. While they're certain to agree on the core principles, when it comes to particulars, such as large-cap versus small-cap, telecom versus transportation, East versus West, onsite research versus pure data analysis, there's bound to be disagreementsome of it vehement.
The trick is to find the combination of tools, techniques and strategies that is right for you, addresses your specific financial goals, and best fits your personality and emotional makeup. And that's where The Art of Value Investing comes in.
Giving you unparalleled access to the thinking of the brightest and best of the value investing world, The Art of Value Investing can save you years of frustrating (and expensive) trial-and-error. With the helping hand of value investing luminaries such as Julian Robertson, Seth Klarman, David Einhorn, Joel Greenblatt, Mason Hawkins, Jean-Marie Eveillard, Bill Ackman and Bill Nygren, to name a few, you'll discover your preferred strategies for exploiting market inefficiencies, researching and valuing companies, identifying industry sectors and geographic regions in which to invest, timing buys and sells, managing your emotions, and much more.
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Top Customer Reviews
If one were to take the time to synthesis the information in the book a cohesive investment strategy could be developed, but the flaw in the book is that the author did not do that for the reader. Instead they provided quotes from professional money managers and let the reader figure out which advice to follow and what to ignore.
Many of the ideas are very contradictory, or not very applicable to the individual investor. One example would be the discussion on number of securities to hold. How many stocks held by a fund with billions under management and numerous analysts is mostly irrelevant to the individual investor.
The important parts of this book could easily have been condensed to pamphlet size. Much of what is quoted is essentially meaningless. . Insight such as “we generally want to own only those things that can be bought out” is not very useful to me when making a decision on what to invest in.Read more ›
The Art of Value Investing takes a similarly broad view, quoting well over 100 value investors (I lost count) on topics where professional value investors agree & disagree. The authors have interviewed the grand majority of those cited, and have useful historical quotes from well-known figures familiar with the subject. Better known and more accomplished value investors tend to get more play in the book -- I think the authors chose well.
The book is organized by topic. It covers these questions:
* The importance of a margin of safety
* Buy high margin quality businesses, or cheap low margin businesses?
* What attention should be paid to growth opportunities? (Controversial)
* What is your circle of competence? (I.e. what opportunities do you rule out because you don't get how to value them?)
* How small of a company would you consider buying?
* How much do you incorporate top-down macroeconomic considerations?
* What countries would you not consider buying a company within?
* The advantage of being able to buy and hold for years.
* How careful research often conquers uncertainty.
* Do you buy turnarounds or not? (Controversial)
* How do you generate good buy ideas?Read more ›
The author interviewed (or collected) hunderds of citations from known value investors and hedge funds managers. In here you'll find the well known names (Greenblatt, Buffett, Munger, Einhorn, Bill Miller, Peter Lynch, ...) but also names and (hedge) fund names you've never heard of before. The book is organised in 5 big parts per theme with subthemes. You'll find chapters like Entries, finding fertile ground, the importance of correlation, risk management, sources, competitive advantages, ...). It's really neat because one can read a chapter once and the leave the book and return later to another chapter or theme.
The biggest advantage to me was the flow of new ideas to test or to trade. If you're looking for stock tips you'll be disappointed but if you're looking for new ideas you'll find plenty of them. That's exactly the reason why I love to read books on investing and trading.
Here's just a part of the citations I liked for their inspiration:
Greenblatt: There's a clarity that comes with great ideas: You can explain why something's a great business, how and why it's cheap, why it's cheap for temporary reasons and how, on a normal basis, it should be trading at a much higher level. You're never sitting there on the 40th page of your spreadsheet, as Warren Buffett would say, agonizing over whether you should buy or not. If you find yourself there, it's either not yet clear enough in your head or it's not as striking an idea as it should be.Read more ›
Most Recent Customer Reviews
Lots of advice from a variety of talented people. Easy, fun read. Hard to put down. I enjoyed an audible version. I listened to it more than once. I highly recommend it!Published 1 month ago by Bogumil K. Baranowski
Exactly how it looks! Perfect for what I needed. Much appreciated and a highly recommended item. THANKS!Published 1 month ago by Girly Girl
A fantastic look into the minds of a number of successful value investors. Having everybody's thoughts and views on subjects compiled into one location is a perfect way to learn... Read morePublished 8 months ago by Michael Appleby
Great read. Provides a really good insiders look at the market.Published 12 months ago by Samuel B.
This book is not what I expected. Tilson is an outstanding investor, and someone I look up to. In hindsight, other reviews are spot on in what is included in this book. Read morePublished 19 months ago by Johnny
As mentioned in my last review, I’ve recently been on a kick of reading investment books that are more or less profiles/interviews of famed investors, rather than the same write up... Read morePublished 21 months ago by Ant Gara
The best value investors are quoted. Buffett too. ( Personally wish there was a lot more Buffett). Great book never the less!Published 21 months ago by Neal Kluge