Bill Ackman Recommended Reading List
Bill Ackman is famous American investor, hedge fund manager, and philanthropist. He is the founder and CEO of Pershing Square Capital Management, a hedge fund management company. Ackman is considered by many people to be a contrarian investor but considers himself an activist investor (looking for large companies with great potential, but with financial problems, which he solves in such a way that the stock price rises and getting the value appreciation gains from these shares.).
I take Ackman as a very smart guy. He came from an affluent childhood, graduated from Harvard University in 1988 with a bachelor’s degree in history and then went on to graduate school in business administration at Harvard Business School.
After his first days in real estate, working with his father, he decided to create his first hedge fund in 1992, together with Joel Greenblatt. The fund did fine, but he decided to close it in 2002. Two years later, Ackman opened his famous Pershing Square Capital Management with an initial capital of $54 million.
The Company offers portfolio management and consulting services to private investment funds, while 17% annualized returns generated since 2004 made his fund stand out.
Given all of the above, you’re probably wondering what this man is eating, watching, reading, thinking. I know, so have I. Though I don’t know other things, I know what he reads, and below you’ll be able to find books he recommends with my reviews. Some of the links are affiliates, and I may earn a small commission when you make a purchase through them at no additional cost to you.
“Everyone told me it was a really stupid idea to start my own hedge fund right out of business school. That’s how I knew that it was a good idea.”
Bill Ackman
The Intelligent Investor by Benjamin Graham
As with many great investors, recommended reading list begins with this book, the Intelligent Investor – bible for investors. I honestly think this is the best investment book ever written. And I am not the only one. Warren Buffet thinks that also. And it is first on the recommended reading list of Bill Ackman.
If you want to be a good investor, this book is a must. Don’t have the money to buy it? Borrow it at your nearest library.
“The intelligent investor is a realist who sells to optimists and buys from pessimists.”
Benjamin Graham, The Intelligent Investor
You will find all sorts of quotes, and some of them will make you think and rethink. The book is not easy to read, people study it for months or even years, but when you finally understand it, a new world will open up to you – the world of investing.
The Essays of Warren Buffett: Lessons for Corporate America, Fifth Edition
Aaaah so much wisdom from the oracle of Omaha. You can judge a man by his recommended reading list and be right 100% (trust me I know that because I write recommended reading lists) and Bill Ackman is a value investor (specific in some way), you can see that from a plane. He follows Warren Buffet and his techniques which can be taught from this book.
The Essays of Warren Buffett will teach you how to properly invest. You should invest in the business behind stocks and not in stocks! And don’t forget his two rules: 1. Do not lose money and 2. Do not forget rule number one.
Many other things are also mentioned in the book, like durable competitive advantage, emotion of a stock market, essence of value investing, time. All interesting concepts. If you are not sure about what they mean or you would get confused when explaining them to your closest friend – then my friend I would strongly recommend you to get this book. Get familiar with these terms and start using them in your life. It will be wonderful.
“Don’t invest in something you don’t understand.”
Warren Buffet
The Warren Buffett Way: 3rd Edition by Robert Hagstrom
Another book by our master. Not to lenghten much, this book helps you to see and delve into the ways into which Buffett processes his investments but also shows how his upbringing, mentors and experiences has helped him in his investment endeavors and the investment choices.
I would highly recommend this book to anyone, regardless of their level of experience, even if you aren’t interested in stock market. A very easy read and well organized book from which you can learn a lot.
The Security Analysis By Benjamin Graham – 1951 Edition
Bill Ackman, along with the book The Intelligent Investor, also recommends the book Security Analysis by the same author, Benjamin Graham. Both books go hand in hand for those who want to learn value investing.
Although The Intelligent Investor is a better-known book, for those looking to deepen their knowledge of value investing strategies, Security Analysis is a must-read.
To be honest, this is a fat book with a lot of information to chew on, as with Graham’s other book. It’s not the easiest to understand. But once you understand, you will be at an advantage over other investors.
You may have noticed this is a 1951 version. The reason is that there are differences in newer available versions, and the current version has a lot of non-Graham-like stuff in it.
You Can Be A Stock Market Genius by Joel Greenblatt
The title of this book sounds like some kind of scam. But it’s actually a great book where you’ll learn how to profit from various special situations. The book is for intermediate to advanced investors. It explains merger securities, spinoffs, recapitalizations, bankruptcy and risk arbitrage.
Joel Greenblatt is the founder and a managing partner of Gotham Capital, a private investment partnership that has achieved an unbelievable annual return of 50% for ten years. He published the firm’s audited returns at the end of the book.
The book consists of frequent humor, making this book an interesting journey in which you will learn a lot, and also have a good laugh.
All books on the recommended reading list from Bill Miller are amazing. I think every investor should read every single one more times. The list explains why Bill Ackman is such a good investor and many people follow in his footsteps.
Margin of Safety by Seth Klarman
I think you already know what this book is about. The title is originally from Benjamin Graham who’s book can also be found on this list. So, as you might have guessed its about how to invest with a margin of safety, Margin of safety can be another word for value investing, and perhaps more importantly, the logic behind it, demonstrating why it succeeds while other approaches fail.
The book will teach you what metrics to look at when valuing a company. I can tell you as equity analyst that it is quite interesting how Wall Street and majority of public look at metrics like EBITDA, earnings per share, while in this book the most important metric is free cash flow.
Depreciation is also real and not deducted like many analysts do when valuing a company. You will also learn about various instruments of the stock market and how to understand risk.
Great book to read and learn about value investing. However, the book should be updated according to new market standards and more examples would be helpful.
Fooling Some People All of the Time by David Einhorn
Daivd Einhorn, author of this book is a president of a hedge fund Greenlight Capital. This book will give you a fresh look at Wall Street, with all parties included (regulators, media, etc).
As title says, stock market isn’t so “clean”, many bad things happen, despite regulators. The book writes about events that happened more than 10 years ago, yet you can still learn from them because they are repeating throughout history.
Book is a good read, but with some financial knowledge you will chew this book easier.
“What you will find within the pages of this book will blow you away. This is a tale of deceit, fraud, misrepresentation, cloak-and-dagger antics, millions and millions of wasted taxpayer dollars, and an unbelievable amount of effort expended by Einhorn and others to bring it all to light. . .This book may go down as one of the classic financial forensics books of our time.”
Clyde Milton, Seeking Alpha
Confidence Game: How Hedge Fund Manager Bill Ackman Called Wall Street’s Bluff
The book gives you an insight into what it takes to thoroughly research a company over many years and to go against the grain. What you will read about in this book is how Bill Ackman used the press, stock analysts, and the government to beat down the price of a stock he has bet against. Truly astonishing.
Confidence Game is a compelling account of one person’s amazing determination to question and challenge conventional wisdom and the status quo on Wall Street and to dangerously tamper with what he was told was a linchpin of national economic stability.
One Up On Wall Street by Peter Lynch
Peter Lynch, legendary money manager will in easy to read and humorous tone explain his own strategies for investing and offer advice for how to pick stocks and mutual funds to assemble a successful investment portfolio.
The book will tell you how to invest with knowledge you already have. It doesn’t have to be hard, take long hours, or special skills. Look at the products you already use. Companies you already know. The book will explain how to do it in more detail.
Beating the Street by Peter Lynch
This book offers some additional staff to One Up On Wall Street as it provides more investment strategies on how and why stocks were picked. Better for the moderate investor or if you already read his first book.
There’s a company behind every stock and a reason companies—and their stocks—perform the way they do.
Peter Lynch
Quality of Earnings by Thornton L. O’glove
This book should be a must-have for investment beginners. As an investor you have substantial success if you master the tools that others (out of conformity or lack of knowledge) aren’t capable of. Being conscious about the recommendations given in this book is a moat for new investors!
The book is great for the fundamental investor and gives good detail and tips for value investing.
Summary
From the books posted you can see Bill Ackman is a value investor. He recommends books from some of the biggest fundamental brains out there. Nothing much to say here, except – the more you learn the more you earn. So, follow your mentors, order their recommended books and read as much as you can.
