I am looking resources for self-education on security analysis. I read some books such as Intelligent Investor by Graham and trying to get further knowledge (will be using this knowledge for myself). My goal is to utilize this information for personal finances/investing.
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What are your goals, and have you determined how securities analysis plays a part? I ask because for many people, significant securities analysis is not as critical as good budgeting and a commitment to regular contributions to a simple retirement plan.– Grade 'Eh' BaconFeb 1, 2021 at 14:09
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What is "securities analysis" ?– FattieFeb 1, 2021 at 15:30
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@Grade'Eh'Bacon updated the question– ewr3243Feb 1, 2021 at 17:41
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@ewr3243 I mean - what are your basic financial goals? Are you looking how to invest your first $5k saved as a 20 year-old? Saving for a house in 3 years as a 30 year old? 2 years away from retirement? Depending on your stage of life, basic personal finance [including budgeting and the very basics of using tax-advantaged accounts {ie: 401k in the US} with a simple diversified index fund investment strategy] probably make more sense as a starting point, compared with actually evaluating securities yourself, for individual 'stock picking' [which is somewhat niche, and carries high risk].– Grade 'Eh' BaconFeb 1, 2021 at 18:06
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2 Answers
One of the books that was the most influential for me was “A random walk down Wall Street”. It is great because it introduces you to all of the most familiar analysis techniques. However, the main thrust of the book is that any and all analysis techniques have flaws, especially technical analysis.
Divided into 2 main groups:
- technical analysis
- fundamental analysis
One of the most important lessons to learn first when investing is humility, and that simple index investing will nearly always be superior. But for me, I still love analyzing fundamentals so I’ve done it all my life.
The other great writer is Peter Lynch. His book is “One up on Wall Street”
I would suggest buying a used copy of Sydney Cottle's version of Graham and Dodd's "Security Analysis," unless you are very good at accounting. Once you have read that, read the 5th edition of Graham and Dodd's "Security Analysis" which is the 1943 edition but with extensive notes made by leading investors and professors because the world of 1943 has changed very significantly in law, accounting rules, liquidity, exchange mechanisms and so forth.
I would skip technical analysis unless you are going to work inside a securities firm. The House Always Wins is a good rule in technical analysis. You cannot outrun them.
