Customer Reviews

Zebra In Lion Country: The Dean Of Small Cap Stocks Explains How To Invest In Small Rapidly Growin

5 star:		(10)
4 star:		(1)
3 star:		(3)
2 star:		(1)
1 star:		(3)

 

 

If you are looking for a book on how to pick small cap stocks, this book is not for you.

If you are looking for reasons why mutual funds are better off than picking stocks on your own, this book will offer you many such reasons.

Mr Wanger invests in what I would conclude as a fundamental-value style and indeed there are certain principles that a reader may be able to extract and apply to his own stock picking approach, eg investing in themes, buying value etc.

However, the more I read, the more the book seemed to promote mutual funds for the lay investor. Depending on your personal preferences, that may indeed be the way to go for some of you.

I offer the following quote from page 237 as a summary of this book:

'Don't overpay, no matter how much you like a company. Invest in themes that will give a company a long-term franchise. Invest downstream from technology. Think and invest globally. Find stocks to own, not trade.'

Ralph Wanger writes about his investment philosophy and his experiences while managing the Acorn Fund (spanning over 25 years, and encompassing varied stock-market environments) in this `un-putdownable' book. Most investors know that the phrases "disciplined investing" and "small-cap stocks" generally don't go together. In an area where gunslingers dominate the scene, Wanger's approach, explained by him in his inimitable humorous style, comes across as a breath of fresh air. "A Zebra Among the Lions" will be useful both for mutual fund investors and for those who want to invest in small-cap stocks on their own. Chapter 6 ("Themes and Variations") and chapter 7 ("Downstream from Technology") are of particular interest -- Wanger not only explains his investment philosophy in detail here, but also gives helpful pointers to those who have the time and the inclination to venture into the small-cap world on their own. And for those who prefer to stick to mutual funds, he provides a yardstick by which to evaluate their fund managers. Wanger also elaborates on the opportunities in international small-cap investing (and its importance in the coming years and decades) in Chapter 11 ("While You're at It, Include the World"). Finally, in Chapter 12 ("Parting Reminders"), he offers valuable guidelines that the investor has to keep in mind in order to achieve success. In summary, Wanger explains how it is possible for the zebra (the investor) to eat fresh grass (get attractive returns) and yet, minimize the chances of being attacked by the lions (losing money in the market)! "A Zebra Among the Lions" shatters the myth that small-cap investing has to be tumultuous and risky. Quite to the contrary, it can be systematic and rewarding. And fun too! If you find this a little hard to believe, I strongly recommend that you read this book!

The information within this book is worth knowing, but the majority of the information is either common knowledge or redundant examples. Ralph Wanger certainly does share his method for success, which has worked for him, but he does not hold any "secrets" for dramatic results (because no one really knows these secrets).
This book can enlighten a person on some aspects of the "market world," but this book contains no vital information on surviving the stock market, which is stated in the introduction. Wanger only presents the method he uses, and if someone could use one of his ideas to produce a profitable strategy, this book is worth reading.
I, personally, did not enjoy this book, but I did not dread reading it. The useful information contained in this book could have easily been displayed in maybe 15-20 pages. The rest of the book is examples of things to further induce his key points.
I would not recommend this book, but if a novice trader had absolutely no idea about what goes on in the stock market, this book may give some helpful ideas.

This book is written by a man who has clearly seen it all and can still laugh about it. Mr Wanger is very entertaining, and at times very candid about his past blunders. The entries from his personal diary from October 1987 (we all know what happened then!) were fascinating. Now the down side: Not much hard advice for individual investors. This book might be helpful to mutual fund managers, but I manage my own investments, and I really didn't take away much usable information

The back of the book states that "Wanger shows investors...how to achieve the right balance of safety and risk..." and he "shares his profit-maximizing, risk minimizing investment advice" but all Wanger does is go on endlessly about what not to do, how market timing or growth strategies are doomed to failure, what great small cap stocks he picked, and why individuals are unfit for picking stocks. He rarely proves anything he says, usually just stating his personal opinion as fact. He takes swipes at almost all investment strategies other than his own (GARP). This book is too useless for a beginner, too basic for a veteran, and an all around waste of money. Unless, of course, you would like to hear the unproven ramblings of a fairly successful mutual fund manager. But be warned, he will continually tell you how unfit you are to pick stocks, and that your only hope will be to invest in mutual funds. Go read anything by Peter Lynch rather than this book. Lynch's books are more informative, more interesting, and he doesn't repeatedly insult his readers.

The subtitle claims this book explains "how to invest in small rapidly growing companies".

Well, it turns out that, according to this book, the best way to accomplish this is to invest in small, rapidly growing companies. In all seriosness, there is almost no useful advice in this book about how to pick stocks.

What this book does explain, in extravagent detail, is why you should not pick stocks, you should use a mutual fund, and while we are on the subject, the Acorn fund (which is run by Ralph) has made lots of money. Also Acorn lost some money here and there, you shouldn't get the impression that the author is claiming infallability.

In all fairness, this was a fairly interesting read, and provided some good general insights into investing. But as far as useful insights into choosing small, rapidly growing companies, the reader is left with the impression that this can only be done by professionals. A legitimate viewpoint, except for the fact that this is exactly what the book promises (fraudulently, in my estimation) to explain how to do.

Wanger is a bright guy with a good long term record of beating the index. He explains his thinking and his "top down" process for picking stocks. He doesn't give some pat formula for beating the market and admits that most professional investors (and funds) can't. I thought it was much better than reading a book about Peter Lynch bragging about his ten baggers.

Ralph gets away from the mysticism too often associated with Wall Street. He puts everthing in human terms and leads one to understand that skill and luck make good partners and be suspect when someone says they have a sure winner. This is the best book about the Street I have ever read and I put it ahead of my previous two favorites; "One Up on Wall Street," Lynch and "The Stock Market," Leffler. In fact I think this book and the Penguin Classic, "How to Lie With Statistics," by Triffin, are a must read for both investors and financially oriented consumers

This book is NOT even similar to Fundamental Analysis, by Graham ( Buffet's peer so to speak - value investing), it is not
Technical Analysis book. It is similar to Lynch's book - One up on Wall Street, but better - I am a bit biased possibly - I been in the Acorn Fund since about 1986 or so, and like him I have my BSEE, although I am not as heavily invested or concentrated in that fund anymore. Acorn Funds was bought by Liberty Funds, which was then bought by Columbia (BoA). I would give One up on Wall Street four stars, Wagner gets five, I do not rate it as a fundamental analysis book, nor technical analysis book. It's no longer a small cap fund with 200 million or so in assets when I opened my account in ACRNX - it's now a mid cap growth fund, with 11 billion dollars in assets. ACRNX has been a top rated five star fund, by Morningstar. for the vast majority of time since 1986, if not the entire time, with lower than average risk, low turnover, and superior returns. If you want something like an automated fundamental analysis that I believe you can modify to your taste and Wagner's approach - check out American Individual Investors ( [...] ) and order the stock screening program - it has a stock screening program that attempts to put Wagner's approach and about 30 other expert's selection method into a software program and database for screening stocks. Wagner does indeed attempt to discourage investors from investing perhaps their entire stock portfolio in individual stocks; since, most people do not have the resources or time to do it his way, visiting companies, plant inspections, listen in on corporate meetings/media events, going to the trade shows - classical intelligence work. A critical part of his method - one will never get the best intelligence by satellite alone - that probably will never happen. The additional piece of information that critical - he states that up to 50%of ones stock investments should be in overseas stocks and that was in 1997 - which makes the on the ground intelligence gathering for the vast majority of individual investors near impossible. Then there is the desk work - research of annual reports, SEC filing, etc - Fundamental Analysis. But, Wagner was starting to phase out and going into consulting/semi retirement for Liberty when the Internet was starting coming up to speed or mature a bit - which make it easier for the individual investor. I was slightly surprised that Wagner used options on the S&P index. I plan on at least loaning my copy of this book to my niece, for graduation she recieve a subsription to AAII. I doubt even Wagner would advise some one to buy ACRNX today if they had to pay a load. Nor advise anyone to pay front end or back end load on the purchase of the shares of any Mutual Fund. There just are too many good to excellent funds with good to excellent mutual fund managers that do not have front end or back end loads.

I have spent the last decade working in the investments industry and only wish I had discoverd Ralph Wanger's book sooner. He is right on target with is investment process and philosopy. In addition, his book is not some dry, droll, academic textbook, he is equally entertaining as he shares his words of wisdom!...