3 Books That Made Me A Better Investor
It’s that time of the year again when all the investor relations departments shut down for the holidays and market news pretty much grinds to a halt. For us financial analysts, it's a time to catch up on stories that we may have missed or simply update a model that didn’t get the attention that it deserved over the year. However, we still have deadlines that must be met, and seeing how everyone loves an end-of-year list, I thought I’d give you an insight into the books I read throughout the last 12 months that I think have made me a better investor.
Thinking in Bets by Annie Duke
This book had such an impact on me that I actually dedicated a whole Expert Opinion Piece to it back in February.
Duke, a World Series of Poker bracelet winner, is obsessed with how people make and reflect on decisions. She uses poker as the perfect backdrop to explain her theories — a space where hundreds of decisions are made in the space of an hour, sometimes with very large sums of money on the line, and instant feedback.
One key learning from the book was the idea of resulting — that we judge the prudence of a decision on the outcome, without thinking if the decision was a good or bad one to begin with. Not only do I believe this book will help the reader become a better investor, I think it will help with all aspects of someones life. I can’t recommend it enough.
The Power of Habit by Charles Duhigg
“The chains of habit are too light to be felt until they are too heavy to be broken” — Warren Buffett.
I’m not sure if the Oracle of Omaha was talking about regular investing here or his daily McDonald's breakfast routine. Either way, it’s a great quote.
If you’ve ever struggled to break a bad habit or yearned to start a good one with little results, this is the book for you.
From an investing standpoint, I found some very interesting insights into how companies manipulate the power of habits to get people to buy more stuff or try out their new product. For example, back in the early noughties, Target was obsessed with trying to find out when families were expecting a newborn, as times of great change tend to form lifelong habits if you can catch them at the right time.
Super Pumped - The Battle for Uber by Mike Isaac
My favourite book from last year was Bad Blood by John Carreyrou. It was a highly dramatic retelling of how greed blinded the biggest names in technology, putting people’s lives at risk in the pursuit of that big payday.
Super Pumped tells a slightly different story. It shows how technology rewrote the rules and created new and cut-throat power struggles in Silicon Valley, threatening the status quo, and destroying antiqued systems at a blistering pace.
Before reading this book, I really thought I knew most of the Uber story. I was so wrong. It’s a deep dissection of how modern-day venture capital operates — which can be very informative when thinking about how we ended up where we are.
Surely we’ll get a WeWork book in 2020, right?