Most Important Books for Equity Research: Stock Market Analysts

 

“The more that you read, the more things you will know. The more that you learn, the more places you’ll go.”
Dr. Seuss, I Can Read With My Eyes Shut!

 

How true is that?

My personal experience says, majority of experts in any field have one common habit – Reading.

From childhood till date, how have you gathered knowledge about anything?

The answer varies. From your own experiences to watching TV, listening to radio, the Internet and … ? Yes, books.

I’ve acquired most of my memorable lessons from reading books.

Here’s the picture of (some) my books on investment.

 

 

1x1.trans Most Important Books for Equity Research: Stock Market Analysts

My Investment Books

 

By looking at the above books you’ll get an idea—of the kind of books I’m going to suggest.

I get emails- from people who are looking for jobs in equity research – asking me about the best books on equity research

 

Suggested books /reading for equity research and stock market analysts:

 

1. The Intelligent Investor – By Benjamin Graham

2. Security Analysis – By Benjamin Graham and David L.Dodd

3. The Interpretation of Financial Statements – By Benjamin Graham

4. The Essays of Warren Buffett – By Lawrence A. Cunningham

5. One Up on Wall Street – By Peter Lynch

6. Beating the Street – By Peter Lynch

7. Learn to Earn: A Beginner’s Guide to the Basics of Investing and Business – By Peter Lynch

8. Buffettology – By Mary Buffett and David Clark

9. Best Practices for Equity Research Analysts – By James J. Valentine

Best Practices for Equity Research Analysts

This book is one of the best books written so far specifically for equity research analysts.

According to the author, James Valentine, there are some non-technical skills that every equity research analyst must have.

The skills are:

  • Selecting the optimal universe of stocks
  • Time management
  • Influencing skills, and
  • Managing information flow

Read the preview of the book: Best Practices for Equity Research Analysts.

Are these books enough to become stock market/ equity research analyst?

No.

It’s the starting point.

Apart from the books mentioned above, you need to read books on behavioral finance.

One more important resource that you must read is—annual reports of companies. Read everything in annual reports.

 

What’s there for you in an annual report as a stock market/ equity research analyst?

 

1x1.trans Most Important Books for Equity Research: Stock Market Analysts

Reading Annual Report / Kozzi.com

 

Everything. Everything about the company that you’re researching on.

You’ll understand company’s business model, financial position, operational efficiency, competitive scenario, the people who manage the company (i.e. company’s management), company’s future outlook, investor-friendliness of the company and lots of other things.

I read annual reports of the company before investing. For example, read my investment analysis report of Colgate Palmolive here.

 

Books or the Internet for equity research analysts?

 

I prefer using books to the Internet.

Why?

For a simple reason–my attention span is more when I read books (physical not eBooks).

Of course, I read on the Internet, but that’s for research and analysis purpose … not for core reading.

My observation is – the books are more in-depth and once you start reading a book, you’re more focused and less distracted.

In short, if you are wondering which books to read as a stock market/equity research analyst, you should start with core investment books and then read books on behavioral finance.

Don’t forget to read annual reports of the company that you’re analyzing. You can read the books in physical format or in electronic format as per your convenience.

How about start reading a book in the above list from today? Read only 5 pages, take pleasure in reading, forget everything while reading.

Did I Forget Anything?

There you have it, a complete list of best equity research books…from my own experience.

I spent 5 hours for this post to give you the list. Even so, I’m sure there are a few that I missed.

Or maybe there’s one on the list that you disagree with.

Either way, leave a comment below!

“Books are the quietest and most constant of friends; they are the most accessible and wisest of counselors, and the most patient of teachers.”
Charles William Eliot

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1x1.trans Most Important Books for Equity Research: Stock Market Analysts

12 Responses to “Most Important Books for Equity Research: Stock Market Analysts”

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  1. Gaurav Singh says:

    Hi Sir,

    I want to become an equity research analyst . How should i start developing the skills required for this profession . I’m going to write CFA level in Dec 2014 . Additionally , can you please tell me the linkage between equity research & financial modelling. After Clearing which level of CFA , should i take up financial modelling course . & is equity research and Portfolio management same .

    Thanks,
    Gaurav

    • Hi Gaurav,

      Read all the posts (including comments below each post) on this category page. You will be clear about the skills required to become an equity research analyst.

      Excel and financial modeling are skills that you need for forecasting and valuation, which is used for equity research.

      You can take financial modeling course after CFA Level II if you are a graduate. If you’re a post-graduate, you can take up financial modeling course anytime.

      Equity research and portfolio management are two different things.

  2. Lya says:

    Hi Avadhut,

    Now I am working for a brokerage house as an assistant equity research analyst. I have finance background both from school and CFA level 1 exam. But the problem is I’m still struggling in writing. Do you have any suggestion for me which books to read to improve my writing skill as an equity research analyst. Massive thanks!

    Cheers,
    Lya

    • Avadhut says:

      Hi Lya,

      Great question :)

      For writing,you need to do 2 things – Reading and Writing – consistently .
      Read at least one equity research report a day. Notice the language and tone that they are using. Learn how to start a particular point and end it. Check verbs, jargon, data, examples, presentation that different equity research analysts are using.

      I’ve written a detailed post on this – How to Write Equity Research Report.

      Interestingly, I’m working on a course -How to Write Equity Research Reports :) It will be launched soon.

      Let me know if you need any other help.

  3. Rahul says:

    Sir
    I have an interview for the post of equity research analyst on monday
    I just have cleared CFA Level 2 but have no experience?

    What all things i should prepare for interview ?

    • Avadhut says:

      Hi Rahul,

      60% of the questions will be based on your resume. Other questions will be on your views and personal experience about equity. They will check your thought-process.
      All the best.

  4. Nagraj Pawar says:

    Hi,

    I am Nagraj pawar, B.com graduate & C S Inter. I want to learn all about equity research, so please tell me how i can start now. also i want to do entry level job in this industry so can i get job on the basis of my present qualification.?

  5. Alisha says:

    Hi,

    Today i cleared the interview at Reval Analytics for the position of Junior equity research analyst position. Apart from my educational knowledge (Masters in Economics and currently CFA level 1 candidate) i used your website to have an idea about what equity research is all about. Your work has been very beneficial for me, i thank you for that. I need you to guide me with which book i should start reading to further gain my knowledge and develop skills in equity research. Which to start with Security Analysis and Portfolio Management by Donald E Fisher or Best Practices for Equity Research Analysts – By James J. Valentine. Thank you.

    • Avadhut says:

      Hi Alisha,

      Congratulations :)

      Glad to know that FinanceWalk helped you in clearing concepts about equity research.

      If you haven’t read – Buffettology – By Mary Buffett and David Clark, start with that book. Then you can go for Intelligent Investor. Then go for One Up on Wall Street – By Peter Lynch.

      Once you complete the above books, then go for Security Analysis – By Benjamin Graham and David L.Dodd.

      Best,
      Avadhut

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