The author of this book is Andrew Tobias. He is an American writer with 12 published books in different disciplines. The contents of The Only Investment Guide You’ll Ever Need lean towards personal finance, rather than investment. Furthermore, most lessons can only be applied in the United States.
Layout of The Only Investment Guide You’ll Ever Need
There are a preface, an introduction, 11 chapters which are divided into three parts, and 9 appendixes.
Part 1 is Minimal Risk and is about minimizing expenditures.
Part 2 is The Stock Market. This part contains tips on trading in the stock market.
Part 3 is Family Planning and talks about taking care of our families and asset allocation.
Highlights
This book does not have much advice on investment. It is more on personal finance. For picking stocks, the author recommends Joel Greenblatt’s Magic Formula Investing explained in The Little Book that Beats the Market. But he does not advocate stock picking. He suggests the readers to employ mutual funds or exchange traded funds (ETFs).
Furthermore, the author asks the readers to avoid derivatives such as options and futures as this can easily ruin us financially. Options are worse than zero-sum game due to the brokerage commissions according to the author.
Another thing is that to get rich, we have to accumulate more capital. How do we do it? By saving and reducing our expenditures. The author also does not recommend using leverage as it is a double-edged sword.
How should we invest? The author suggests us to answer the following questions: Who am I? What am I trying to do with my life? Is money the means or the end? Based on the answers, we should select the investment styles that suit us the best.
If you do not want to read the whole book, just skip to the appendix Still Not Sure What to Do? This appendix is the short summary of the whole book.
Conclusion
Is this book the only investment guide that I will ever need? I beg to differ. A large part of this book is about saving and a lot of tips are not applicable in Malaysia. But the author did claim that his book may not be the best investment book ever.
As for the investing part, it can be summarized as investing in low-fee, no-load index funds or ETFs, which is quite hard to achieve in Malaysia too. Nonetheless, I cannot deny that it is a good read as the author’s writing style is humorous.
Before I end, let me share some quotes from the book.
“Money does make money. The rich do get richer.”
“Three things the financial markets reward: volume, patience, and risk. To each of the three, the same refrain dolefully applies: the rich get richer.”
“Over long periods of time, stocks are almost sure to beat fixed-rate investments.”
“What a stock is worth depends at any given time on the alternative investments that are then available. It is a question of relative value.”
Recommended book
If you are interested in The Only Investment Guide You’ll Ever Need, you may get the book from Kinokuniya Malaysia through the link below*.
*Disclosure: The above link is Involve Asia affiliate link. Thus, I may earn a small commission when you purchase the book through this link.
