Hedge Fund Market Wizards is the latest in Schwager’s well-known series on learning investing lessons through conversations. This latest volume contains 15 probing interviews with top hedge fund managers on their investment strategies, successes, and mistakes.
The late Barton Biggs was the Founder of Morgan Stanley Asset Management and of own commodities hedge fund, Traxis Partners. Hedgehogging is the diary of his journey through the eccentricities of the hedge fund culture. A particularly good read for those with the ultimate aspiration of starting one’s own fund.
Bruce Greenwald, Paul Sonkin
Columbia professor Greenwald and Gabelli portfolio manager Sonkin assumed the value mantle from Buffett and Klarman in the 21st century. The book Value Investing is applicable in today’s markets with more efficient asset prices, and is a key read in the Value Investing Program at Columbia Business School.
Growth at a Reasonable Price (GARP) is arguably the most common investment style among hedge and mutual funds today. Many credit Peter Lynch, the legendary manager of Fidelity’s Magellan Fund, as the chief evangelist of the GARP style. One Up on Wall Street emphasizes the importance of investing based on a company’s quality and consistent earnings growth. The investment goal is to hold investments for the long-term and generate “multi-bagger” returns.
Warren Buffett once said, “I’m 15% Philip Fisher and 85% Benjamin Graham.” Fisher emphasizes earnings growth over valuation, particularly for secular industries such as technology and healthcare. The book is a must read to lay the groundwork for investing in companies based on earnings momentum.
You Can Be a Stock Market Genius is widely regarded as the seminal text on special situations investing. The book details the process and nuances of spin-offs, merger & risk arbitrage, restructurings, rights offerings, bankruptcies, liquidations, and asset sales. The investment processes laid out in the book are widely employed by hedge funds.
I was a distressed analyst in J.P. Morgan’s Special Situations Group, and Moyer’s book is the gold standard in the distressed investment community. Distressed investing is a complex subject and are oftentimes taught from a theoretical, academic approach. Moyer breaks down the investment process in very practical terms and provides concrete examples of each step.
Gliner, a former analyst at AQR Capital and Tudor Investment, filled a void in investment education with Global Macro Trading. There’s a severe lack of good practical guides on macro investing, and this book gives you hands-on tutorials on foreign exchange, equities, fixed income, and commodities. It takes you from having no prior knowledge in macro trading to understanding specific systematic strategies. A must-read for those interested in macro and commodities hedge funds.
Carlisle is the author of the Greenback’d blog and an ex-lawyer specialized in shareholder activism. In Deep Value, Carlisle takes the reader through the evolution of the deep value investment strategy, which has evolved from Buffett’s “buying cigar-butt” approach to today’s activism in the boardroom. It’s an engaging learning experience with well-written stories and examples.
Chan’s book is a practical guide to algorithmic investing, with explanations of key algorithms and programming code examples. He dives into techniques for back-testing, statistical regressions, algorithmic strategies, and code implementations. It’s written by a practitioner for those interested in joining al quant fund or becoming an individual quant trader.
This book is the updated version of Greenblatt’s original book on fundamental analysis. Greenblatt’s emphasis on return on capital and earnings yield form the foundation of company quality analysis in today’s markets. It’s an essential piece of your value investing book collection.
Oaktree Capital founder Howard Marks is best known for his emphasis on “second-level thinking”. First-level thinking says, “it’s a good company, let’s buy the stock”. Second-level thinking says, “everyone thinks it’s a great company. That makes it overpriced — sell.” This is the foundation for developing contrarian investing views.