Dear Friend, I promise you – this article will create wealth for you because you will increase your knowledge from it. And Knowledge is the true wealth. Increasing your knowledge and learning investment is the most essential concepts of investment. We developed money concept to make our life easier. As the time passed we realized the need to maximize the money we have.Why we need to maximize our money?
Because we tend to overlook the general trends of inflation and the interest rates offered by our Indian banks. Suppose you have 100 rupees in your regular savings account. Most of the Indian banks are offering an interest rate of 4% per annum. So after a year you get 104 rupees. Now inflation rate of our country in 2015 was 6.32%. It simply means that you need to have Rs 107 in your bank account after a year to fight the inflation only. So you actually need to learn ways through which you can grow your Rs 100 above inflation and get a true profit.
I have often wondered that the richest guys in the world invest in stocks and other investment schemes but the middle class only invest in fixed deposits scheme and savings account when every knowledgeable person is aware that these two investing options do not give any real profit or return.
The most important point in investing is to start early in mid 20s to create maximum wealth through the power of compound interest. For sure by now you have realized the importance of learning investment. So here are some of the world famous books on investment. Read them and increase your knowledge.
- “Rich Dad, Poor Dad” (2000) by Robert Kiyosaki
This classic is a must-read for young investors. The book says that middle class work for money but the rich work to learn and increase his knowledge.
He stresses the importance of financial literacy and presents financial independence as the ultimate goal.
Kiyosaki advocates investments that produce periodic cash flow for the investor while providing upside in terms of equity value. Real estate and stocks that provide dividends are viewed favorably. The author advises that the school system does a poor job of teaching people to create enough wealth so they won’t have to work anymore.
Kiyosaki strongly advises us to fight the “Chicken Little” attitude within ourselves which makes us afraid of putting every small steps towards money matters by increasing our knowledge continuously.
- “The Essays of Warren Buffett: Lessons For Corporate America” (1997) by Warren Buffett
In his essays, Warren Buffett – widely considered to be modern history’s most successful investor – provides his views on a variety of topics important to corporate America and shareholders. Young investors can get a glimpse of the interface between a company’s management and its shareholders, as well as the thought processes involved in enhancing a company’s enterprise value.
Buffett’s essays include discussions on corporate governance, finance and investing, alternatives to common stock, mergers and acquisitions, accounting and valuation and accounting policy and tax matters. He has a philosophy of bringing in talented managers at portfolio companies and leaving them alone.
He advocates purchasing shares of businesses at times when these stocks are trading at a discount from their inherent value. He opposes following investing trends.
- “Beating the Street” (1994) by Peter Lynch
Peter Lynch is one of the most successful stock market investors and hedge fund managers of the 20th century. He started out as an intern at Fidelity Investments in the mid 1960s. Nearly 11 years later, he was tasked to manage the Magellan Fund, which at the time had close to $18 million in assets. By 1990, the fund had grown to a whopping $18 billion in assets with nearly 1,000 stock positions. During this time, the fund boasted average returns of more than 29% per year. This book allows the reader to understand and peek into Lynch’s mind and thought processes and implement them in your own investment decisions.
I will continue to update this topic continuously as I myself finish some other great books.