Modern technologies are moving forward by leaps and bounds. Together with them, a lot of new professions appear. Most often they are associated with the development and implementation of software, sales and advertising, as well as the development of the financial market. With the advent of the world wide web in our life, entangling all areas of our activity, the securities markets have become more accessible for people who want not only to save money, but also to increase it. So a new profession - a trader - entered the scene. And the shelves of bookstores were filled with novelties promising to teach people how to make money on investments. What is the best book on trading and investing to buy to wake up as a wealthy tomorrow?
Content
Trading and trader, or exchange and broker
The answer is simple. You don't need to buy any books to wake up rich. The fact is that, unlike a broker who disposes of other people's money, a trader will risk his own. This means that at the time of the start of activity, he must have a certain amount of money. It is impossible to argue that there are among the stock market players and those who started working in debt and succeeded. Whether it is worth doing this or not, everyone decides for himself.
As a rule, far from novices in financial affairs consciously come to trading. Most of them by this time already have experience of working in large companies, and possibly their own business. Their main goal is to increase the money earned and not go bankrupt. Many of them prefer to hire an experienced specialist and carry out their main activities, periodically monitoring the processes.
With the development of online platforms, newcomers began to come to trading. Most often these are young, ambitious people who want to make money on exchange transactions. And since they are not taught to be an investor or a trader, you will have to come to grips with self-education and buy publications about trading.
Who should trade
Trading is the same trading. And the trader is in fact a seller. He does not sell milk and bread, or even modern technologies. He sells his own financial resources, which is much more difficult. The simplest example is the Forex exchange, where they play on the difference between buying and selling rates.
The beginning of trading was laid at the end of the last century by brokers from the United States, who, in addition to their direct responsibilities for finding sellers and buyers of financial resources, began to deal directly with the sale of their own resources, having access to exchange trading.
Today, anyone can get access to trading, just register on the exchange. All that is needed for this technically:
- a certain amount of money to form an initial stock portfolio;
- laptop or desktop computer;
- stable access to the Internet.
But, if everything is so simple, then why are millionaires still quite rare. Because in addition to desire and technical equipment, you need to have certain abilities and knowledge. Among them:
- methods and methods of static data analysis;
- methods of building and reading skills of trends presented in both tabular and graphical versions;
- have an idea of the main indicators of financial reporting, both in regional and international standards;
- be able to model the future sales situation based on the available data;
- have an analytical mind and good mathematical skills;
- quickly calculate several options and choose the best one;
- stop thinking forever that when you come to the stock exchange, your life will become easy and carefree.
And read at least a dozen books. Moreover, their name will not contain the words "all about trading" or "all about investments." Such a book simply does not exist. No, though. It exists in any country and summarizes all laws aimed at regulating the securities market. For Russia it will be the Federal Law “On the Securities Market”.
Professional literature will introduce you to the main activities of a trader and help you get the basic skills. Consider the TOP of the main books to be read by future traders. There will be only one selection criterion - how to get maximum information in a short time.
Company reporting as the main information resource
No trader will be able to work professionally without knowing what the main financial indicators of the company are, which speak of its current state. How they are formed, what do they mean, what factors influence them. It is ridiculous to buy shares of a company that has negative profitability or a lack of working capital.
"Analysis of financial statements of companies", B. Graham
Benjamin Graham is one of the best authors on enterprise finance and how it is analyzed. Although the last book was published in 2009, his recommendations have not lost their relevance. By the way, it was on the books of Graham that the first financiers in the post-Soviet space studied.
The publication introduces the basics of the formation of financial statements, such as balance sheet, profit and loss statements of the enterprise, cash flow. It also teaches you how to read these documents correctly, calculate on their basis the financial indicators characterizing the current state of the company, see the positive and negative sides in its work, and also make a forecast for the future.
Advantages:
- The book is written by a real expert in the field of financial analysis;
- The author fully discloses the importance of financial analysis when working with securities;
- Available for novice exchange players;
- It is replete with examples and simple but reliable tests for assessing the financial condition of an enterprise.
Disadvantages:
- According to some readers, it is highly specialized.
The cost of the publication is in the range of 1900-2000 rubles, which cannot be called a democratic price. Although according to reviews, the publication is worth the money. However, today the book is available in electronic form. Therefore, in the future, it makes no sense to give the comparative cost of a particular publication.
“Valuation of companies. Analysis and Forecasting Using IFRS Reporting ", N. Antill
It is no secret that for a long time the accounting and financial reporting of the Russian Federation was quite different from international standards. Ultimately, some companies do not fully implement these standards today. Nevertheless, the external reporting of firms whose shares are traded on the stock exchange is compiled in accordance with IFRS rules. The book reveals all the secrets of financial reporting according to international standards.In combination with the popular book "Analysis of Financial Statements of Companies" by B. Graham, it will be an excellent collection for exploring all the depths of financial analysis.
Advantages:
- The author clearly explains the main aspects of the international financial reporting system;
- Using the examples of individual industries, you can find out how the reporting is formed, and what its indicators mean in a particular industry;
- The book is supplied with many illustrations, graphs and diagrams are shown with images, which fully reveal the current state of affairs in the company.
Disadvantages:
- While reading, there may be a feeling of misunderstanding of what was read among people who are not used to working in accordance with international financial reporting standards.
In this case, it is necessary to raise the literature, which provides a comparative analysis of the two reporting systems.
"International accounting standards and accounting in Russia", E. Mizikovsky
An excellent tutorial for traders who are a little confused about the metrics of different financial reporting systems. The book describes the Russian and international systems in an intelligible language, compares common indicators and describes in detail new ones.
Advantages:
- Perfect for reading by both an ordinary person and a professional who wants to refresh knowledge or fill in the gaps in it;
- Contains many examples and practical tips;
- At the end of each chapter are control questions and tests that will allow the reader to assess their level of knowledge.
Disadvantages:
- Not of great interest to advanced traders.
The recommended list of references should be sufficient to familiarize yourself with the main types of financial statements.
Initial skills of technical analysis of the company
In principle, these are the basic knowledge and skills of a novice trader. Taking the financial statements of an enterprise for a certain period of time, you can display certain trends that are most easily perceived in a graphical form. It is by them that they judge the success of a project.
"Technical analysis. Full course ", D. Schwager
This is a truly complete technical analysis course. From a detailed explanation of its goals, to how to correctly perceive the current trends. The author of the book is one of the leading experts in the field of technical analysis.
Advantages:
- The book reveals all the secrets of technical analysis;
- Written in accessible language and easy to understand;
- Has good recommendations from established market participants.
Disadvantages:
- The classic version of the presentation of the material provides a good basis, but does not take into account modern, instantly changing trends.
To form your own opinion about the development of a trend in modern realities, you will have to turn to other sources of information.
"Japanese candles", S. Neeson
One of the best books on technical analysis in recent years. It is based on fixing prices for stocks or products at the beginning and end of trading. All price fluctuations for the day and their reasons are also noted. By analyzing the change in prices and the level of supply and demand, you can make a long-term forecast.
Advantages:
- Easy to read;
- Pictures and illustrations with a detailed description of the ongoing processes, make information available "for dummies";
- Reading the book will create a very tangible base for advancing in trading.
Disadvantages:
- It is not only the price factor that plays a role in making a decision, so additional literature will be needed.
The book by a Japanese author can become a desktop for a trader playing on currency rates. When placing investments, you will need to calculate and analyze other indicators.
"How to play and win on the stock exchange", A. Elder
The author of the book is a stock market player and psychoanalyst.The book tells about the psychology of trading in detail. A very interesting look at the problems of the exchange market from the psychological aspect of this type of activity. In addition, the book describes in detail the three-screen method, which allows you to look at the situation from three sides. And to understand which of the opinions has an objective justification, and which is only subjective desires.
Advantages:
- It is read literally in one breath;
- Suitable for fans of the psychological genre.
Disadvantages:
- According to experts, the book may be somewhat weak in technical terms.
Knowing how to analyze not only numbers, but psychological aspects, to separate the necessary from the desired, to assess the behavior of competitors, a trader will become a unique specialist.
"Computer analysis of futures markets", C. Lebeau D. Lucas
And the last book in this section. Its content includes not only a description of market indicators, but also tells how to calculate them in various programs, as well as apply in practice. The main goal is to convey to readers that building several dozen trends will only do harm. The main thing is to choose the right parameters and indicators for trading on various assets.
Advantages:
- The book is important precisely for novice traders who are in the heat of trying to grab onto everything at once. And in the end, they have many graphs and diagrams, in which the meaning has long been lost;
- Helps to prioritize;
- Explains how to optimize trading activities.
Disadvantages:
- Does not fully disclose the essence of technical analysis.
Computer Analysis of Futures Markets is not worth reading first.
General information
The books listed above, the main professional literature, recommended for reading by novice traders. However, it does not cover the entire aspect of financial activity. After all, you need to be able to:
- Conduct fundamental analysis or compare companies and transactions with each other in order to choose the one that will bring the greatest income;
- Correctly assess the possible risks;
- Competently compile an initial stock portfolio.
All this can be gleaned from both highly specialized literature and from books that talk about all aspects of investment activity, but in less detail.
"Investments", W. Sharp
A voluminous five-volume collection full of formulas, graphs, diagrams and tables. For those with a good background in financial reporting and technical analysis, his material will not seem difficult.
Advantages:
- An investor's handbook that can answer almost any question.
Disadvantages:
- The book can be difficult for novice traders to read;
- Volumetric and somewhat overloaded with methods and methods of mathematical analysis and mathematical modeling.
The book, shall we say, is not intended for teaching. Its task is to quickly and efficiently help a trader when working with financial resources.
"Investment appraisal", A. Damodaran
The book contains the main methods of risk assessment and ways to minimize them. She will also talk about how to achieve the maximum return with a minimum investment.
Advantages:
- Excellent presentation of the material;
- An understandable book for traders taking their first steps in the financial markets;
- Laconic content, without an overabundance of difficult terms.
Disadvantages:
- None.
What else should you read about trading
A real trader is not the one who makes a profitable deal, but the one who manages to avoid a loss-threatening deal.
To behave correctly in the market, you will have to constantly learn. This means that over time, hands will reach the textbooks on fundamental analysis, risk management and the description of a variety of software that allows you to receive and process information in a matter of minutes. Standing still for a person who has chosen trading as an income is an impermissible luxury.Therefore, you should not believe the colorful pictures, where a beautiful girl with a laptop and a cup of coffee is looking at color graphics.
