- File Size: 20748 KB
- Print Length: 430 pages
- Publisher: W. W. Norton & Company; 12 edition (January 1, 2019)
- Publication Date: January 1, 2019
- Sold by: Amazon.com Services LLC
- Language: English
- ASIN: B07DP6YGVX
- Text-to-Speech: Enabled
- Word Wise: Enabled
- Lending: Not Enabled
- Amazon Best Sellers Rank: #21,600 Paid in Kindle Store (See Top 100 Paid in Kindle Store)
A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing (Twelfth Edition) 12th Edition, Kindle Edition
Use the Amazon App to scan ISBNs and compare prices.
- Highlight, take notes, and search in the book
- In this edition, page numbers are just like the physical edition
- Length: 430 pages
- Word Wise: Enabled
- Enhanced Typesetting: Enabled
- Page Flip: Enabled
Switch back and forth between reading the Kindle book and listening to the Audible book with Whispersync for Voice. Add the Audible book for a reduced price of $7.49 when you buy the Kindle book.
- Due to its large file size, this book may take longer to download
|New from||Used from|
Inspire a love of reading with Prime Book Box for Kids
Discover delightful children's books with Prime Book Box, a subscription that delivers new books every 1, 2, or 3 months — new customers receive 15% off your first box. Learn more.
Enter your mobile number or email address below and we'll send you a link to download the free Kindle App. Then you can start reading Kindle books on your smartphone, tablet, or computer - no Kindle device required.
To get the free app, enter your mobile phone number.
Customers who bought this item also bought
Would you like to tell us about a lower price?
317 customer reviews
There was a problem filtering reviews right now. Please try again later.
Now the tenth edition comes upon a changed world and a wiser reader. Reaction: it is even more captivating in some respects, less so in others.
More captivating: The futility of the individual investor trying to gain an information advantage over the market as a whole is even more compelling today. Investment advisors, fund managers, and many academics have a vested interest in debunking the Efficient Market Hypothesis. George Soros, for example, claims that it "has been well and truly discredited by the crash of 2008." "Markets," say the critics, "are not rational."
Of course they are not, and Malkiel never claimed they were. If "rational" means that markets correctly appraise the value of stocks as the discounted present value of future earnings, Malkiel hardly believes such value objectively exists. Valuations are nothing but forecasts ("what will earnings be in three years?") under malleable assumptions ("what is the correct discount rate?"). Just as individuals can be grossly wrong, markets collectively can be grossly wrong. Does Soros think Malkiel takes no account of bubbles? He should read the first edition which, like the tenth, opens with an exposition of the South Sea Bubble.
The Efficient Market Hypothesis simply holds that markets are very quick to gobble up and digest information--so quick that it is nearly hopeless for an individual to gain an information advantage. Moreover, fundamental analysis heavily relies on SEC filings. After a career of drafting, litigating, and teaching S1s, 10Ks, and 10Qs, I can affirm that, while outright fraud is rare, these things are filled with embedded fictions. Any investor who believes that he can apply some kind of exalted wisdom to data that is equally available to all, is deluding himself.
Less captivating: In the first edition, Malikiel pointed out that 67% of managed mutual funds fail to match the return of broad-based indexes such as the Wilshire 5000. At the time, that seemed to me a stunningly astute observation. Today, it seems banal. Begin with the statistically tautological fact that in any year 50% of funds will perform below the market and 50% above. If you subtract the higher fees and taxes that are sucked out of managed funds, that alone accounts for the difference. (Maybe 33% beat the market in Year 1. But over ten or twenty years, the percentage shrinks to a minuscule level--functionally zero.)
So Malkiel's recommended strategy of buying and holding broad-based index funds is based on nothing more than spreading risk and saving costs: the labor of research and the levy of fees and taxes. That is a useful revelation, but not as brilliant as I thought 38 years ago.
So should non-professionals give up on picking stocks? Yes, if they hope to beat the market over the long term. Yet there is nothing irrational in viewing the market as a kind of roulette table. Roulette is a slightly negative-sum game, while the stock market is a positive-sum game--about 9% positive. You can hit a streak in roulette and come out ahead from time to time. Your chances of hitting a streak in the market are even better, and the game of individual stock-picking can be fun. But we shouldn't forget that it is, as Keynes said, "a game of Snap, of Old Maid, of Musical Chairs -- a pastime in which he is victor who says Snap neither too soon nor too late, who passes the Old Maid to his neighbour before the game is over, who secures a chair for himself when the music stops."
Please let me know if my review helped in your decision making process one way or the other. =)
I work in education, not finance, and I believe it was David Ausubel who wrote that the single most important thing you can do when teaching someone is to anchor new content on the learner's existing knowledge/framework. This book is pretty helpful in that regard. It's more of an introduction to financial markets, but not so basic as to be something you could easily learn from online articles like those on Investopedia (which a great site, but this book is better organized and more cohesive).
So, in short: maybe start with this book, then take Shiller's course, and move on to actual finance textbooks if you're inclined to go deeper. Or, if you just want a casual, future retiree's introduction to financial markets and investing, this book will help plenty.
Malkiel's advice seems almost old fashioned now, but when he first published this book, it was revolutionary. It was the first book for the non-professional investor that used modern portfolio theory to come up with a low-risk strategy for long term growth and security that any investor could follow. It debunked fads, and showed the wisdom of strategies that are now commonly accepted. He promoted mutual finds over individual stocks, and later, index funds over narrower investments. He demonstrated how investing for value outperformed growth over the long run, and told people why they should shift from equity investment to debt (bonds) as they grew older.
39 years after its first publication, this still remains the only book the average person needs to guide their investment strategy. You won't get rich quick following the advice here, but you'll grow your savings in a safe way, and make sure you can provide for yourself through the future.