Top 5 books to learn financial analysis
As a real-time investor, you can never get enough knowledge, there’s always a better trick to the trade that you may not be cognizant about. One common fundamental that an investor must master is understanding the financial reporting of the corporations. It is not smart to invest in the stock market without taking into consideration the financials posted by the company. Analyzing the final reports by the company and simply relying on the market trends may be aghast as it may lead you to a misdirection. Therefore, an investor needs to keep upgrading himself and his grasp of the subject.
To do so, there can be no better way to be thorough with the market terminologies as well as distinct strategies that have been penned down by the connoisseurs of the industry. These books can be your best bet to learn financial analysis and shall help you to understand financial reporting in depth. At the same time, if you are already a regular player in the field or if you have chosen finance as your career these top books shall help you to boost your financial analysis career as well as create a path to value investing. If you wish to further extend your know-how in financial reporting or financial modelling, you can perhaps even consider financial analysis online training through the varied courses offered today.
But for now, let us see the trending 5 books to learn financial analysis. These books range from beginner to advanced levels and thus, you can choose to pick your hand on these based on your level of expertise.
The Intelligent Investor: If you belong to the finance field, you most likely have heard about the book written by Benjamin Graham. This is one of the most popular books that are available in the market on financial analysis fundamentals. This book covers the most important nuances related to the financial world such as stock market trading, how to select your stocks, investment tricks, earning per share, etc. If You are someone who is an avid reader but also has started trading in the stock market, this book is certainly the best pick for you.
Learn to Earn: This book by Peter Lynch, who is a fund manager himself strives to make you reach the financial milestones that you wish to achieve. This book takes you through the nitty gritty of analyzing the financials of the company and applying your best knowledge to increase your earnings through trading. The author believes that investing in the stock market is a necessity in one’s life and therefore has explained the concepts in the simplest way possible.
Warren Buffett Accounting Book: Reading Financial Statements for Value Investing: This is a financial analysis book written by Stig Brodersen. This book teaches you valuable lessons about investing. It gives insight into the intrinsic value of a company, talks about what is a discount rate and how to apply it in your strategies, it also talks about the importance of financial ratios, and provides the reader with detailed instructions on how to read the financial statements of a company. The interesting part of this book is that it provides a distinct perspective on financial reporting and is backed by solid examples for readers to easily grasp the author’s point of view.
The Theory of Investment Value: This is a renowned book that has even inspired Warren Buffet and is highly suggested by him for young investors. The book is written by John Burr Williams and it aims to provide its readers with an idea of how the valuation of stocks is done. It also throws light on discounted cash flow techniques and how the dividend yields are decided by the companies. If you are someone who is looking to update your knowledge about investments, this will be a good pick for you.
Financial Statements, Third Edition: A Step-by-Step Guide to Understanding and Creating Financial Reports: This book is known to be a step-to-step guide for beginners to understand as well as create financial reports. This book by Thomas Ittelson is highly recommended by corporates to their fresh joiners to have a basic understanding of corporate finance before stepping into the practical world. It is a type of book that proves to be more accessible by providing data to the readers by translating the most complicated financial jargon. The main focus of the book however is on how the financial statements of the companies interact with each other and aims to offer a snapshot of the company's financial health.
The above 5 books are a game-changer for someone who has a deep interest in the finance world and would like to up his investment game. These books provide the reader with the varied perspectives of each author and are highly recommended by most experts in the field. These books help you to cut through the noise and understand the financial shenanigans most efficiently.