Suggested Readings

Interested investors may wish to pursue a greater understanding of investment fundamentals. The following books have made a major contribution to the investment community and have been instrumental in the development of the investment philosophy employed at Sprung & Co.

1. The Intelligent Investor: The Definitive Book on Value Investing, Revised Edition; by Benjamin Graham; Harpercollins Canada, June 2003:
First published in 1949, this book has undergone several reprinting. Copies of the "classic" anniversary edition are also available. Benjamin Graham is the father of the value investing school of thought. Warren Buffet is perhaps the best known of his disciples. Many of the concepts and rules-of-thumb developed by Graham are just as applicable today as they were sixty years ago.

2. Common Stocks and Uncommon Profits; by Phillip Fisher; John Wiley & Sons, Incorporated, May 1996:
What Benjamin Graham was to the school of value investing, Phillip Fisher was to the school of growth investing. Originally published in 1958, Fisher favoured companies that were low cost producers within their respective industries and had long term growth prospects. Many of his ideas are as applicable to value investors as to growth investors. He was one of the pioneers of considering the qualitative factors such as the quality of management, opinions of customers and suppliers, etc.

3. Extraordinary Popular Delusions and The Madness of Crowds; by Charles Mackay; Three Rivers Press, July 1995:
"Tulipmania", "The South Sea Bubble" and many more financial crises are covered in this fascinating book that covers many of the manias that have befallen investors over the years. Anyone reading this book will certainly be reminded on the "Tech Boom and Bust" of the late 1990's and early 2000's. Somewhat of an argument for contrarian investing, but most definitely and caution against running with the heard!

4. Investment Policy: How to Win the Losers Game; by Charles Ellis; Irwin Professional Publishing, January 1985:
Charles Ellis has been a driving force for the education of professional investors with The CFA Institute (formerly The Association for Investment Management and Research). In this classic text, Ellis discusses the need to remain focused on the long term. Investors need not be reactive to every piece of news that confronts them. Let the other investors make the mistakes while you reap the rewards.

5. Against the Gods: The Remarkable Story of Risk; by Peter Bernstein; Wiley-Interscience, October 1988:
Risk is an over-used word in the investment profession. Bernstien brings the concept to life and gives it real meaning in this remarkable tale of the history of risk theory. Put into layman terms, many of the concepts bandied about make sense to the novice investor in his book.

6. Triumph of the Optimists: 101 Years of Global Investment Returns; Elroy Dimson, Paul Marsh and Mike Stanton; Princeton University Press, January 2002:
Not for the casual reader, nor the frail reader, this heavy, large book analyzes investment returns from around the globe over 101 years. Full of charts and diagrams, long term returns are put into perspective as are the dangers of extrapolating returns from shorter periods. The effects of reinvestment are analyzed along with the biases contained in many of the world's capital market indexes. A great read for the serious investor!

7. Warren Buffet Speaks: Wit & Wisdom from the World's Greatest Investor; by Janet Lowe; Wiley, March 1997:
A collection of Buffet's best writings, quotes and sayings about honesty, investing, running a business, paying taxes, school teaching, and so much more. It's a great way to enhance your investing knowledge and a thoroughly engaging read.

8. Security Analysis; by Graham and Dodd; McGraw-Hill, October 1996:
For the serious investor or student, this book, originally published in 1934, is a timeless classic from which many of the lessons spelled out over seventy years ago are just as applicable today.

9. Handbook of Canadian Securities Analysis: A Guide to Analyzing the Industry Sectors of the Market, from Bay Street's Top Analysts, Volumes I and II; by Joe Kan; John Wiley & Sons, Inc., January 2000:
A "how to" guide from some of Canada's best analysts and strategists of the day. Very interesting reading for the very serious investor. These two large volumes take an effort to read and absorb some of the many insights presented.

10. The Mathematics of Investing; by Michael C. Thomsett; John Wiley & Sons Canada, Limited, September 1989:
Investors are lost without understanding the basic mathematics of finance. The text provides a useful reference guide for the novice investor in an easy to understand fashion.

11. The Undercover Economist; by Tim Harford; Anchor Canada, a division of Random House of Canada Limited, 2007:
Whoever thought economics could be fun? Tim Harford transforms the dismal science into a fascinating study of pricing theory, competitive advantage and many other heretofore laborious subjects, in understandable and recognizable situations. Want to know the truth about free trade or how to protect the environment? Read this book!

12. The Black Swan: The Impact of the Highly Improbable; by Nassim Nicholas Taleb; Random House, 2007:
A Black Swan Event is unpredictable, has a massive impact and is retrospectively "explained". October 19th 1087 was a Black Swan as was 9/11. Black Swans occur but are largely ignored by forecasters and considered to be anomalies outside of our ability to model. Taleb challenges these notions and attacks the too often accepted concept that the "bell-" or "normal" distribution provides a proper framework from which to extrapolate events or their consequences. Teleb attacks the very premise of "Modern Portfolio Theory" and the "suits" that propagate its application. A bit hyperbolic at times, this is a worthwhile read that will cause you to question your perspective on events.

13. Poor Charlie's Almanack: The Wit and Wisdom of Charles T. Munger; Forward by Warren E. Buffett and Edited by Peter D. Kaufman; PCA Publications L.L.C., 2005:
A collection of memories, speeches, writings and insights by one of the world's greatest investors this book will amuse and educate you at the same time. The easy to read script of this book contains many valuable observations and tools for investors at all level. Mr. Munger provides the reader with a disciplined, practical and rigorous approach to analyzing and choosing securities. Although perhaps lesser known, Mr. Munger has for decades been a valued partner and confidant of Warren Buffett.

14. Guns Germs and Steel: The Fates of Human Societies; Jared Diamond, Norton, 1999:
This book examines the theories of human and economic development. It follows an evolutionary path of human progress within the context of natural and comparative advantages at different points in history. The writing style may be laborious for some readers but Mr. Diamond puts forth a logical and rigorous thesis.

15. A Farewell to Alms: A Brief Economic History of the World; Gregory Clark; Princeton University Press; 2007:
A great book to read and contrast with "Guns Germs and Steel". Mr Clark contends that little economic development took place that benefited society as a whole until the eighteenth century. At that point a schism occurred when the industrial revolution in England brought unprecedented advances locally leaving much of the world behind. Why did this occur in that location and not elsewhere? Has the economic progress since benefited all societies? Mr. Clark presents a powerful thesis filled with facts and figures to substantiate his work.


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