The Guru Investor: How to Beat the Market Using History's Best Investment Strategies
Today's investor is faced with a myriad of investment options and strategies. Whether you are seeking someone to manage your money or are a self-directed investor deciding to tackle the market on your own, the options can be overwhelming. In an easy-to-read and simple format, this book will dissect the strategies of some of Wall Street's most successful investment gurus and teach readers how to weed through the all of the choices to find a strategy that works for them. The model portfolio...
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Over the past six decades, the U.S. stock market has averaged an annual return of about eleven percent per year. Yet, except for a few renowned Wall Street gurus, the vast majority of investors, both amateur and professional, fail to come anywhere close to those eleven percent average annual gains. Why do most investors fail—and what do those very successful investment gurus have in common? The Guru Investor identifies the stock picking methodologies developed by some of history's best and most successful stock market gurus—including Peter Lynch, Warren Buffett, Benjamin Graham, Martin Zweig, John Neff, and others—and shows how you can combine these proven strategies into a disciplined investing system that has been proven to outperform the market. John Reese breaks down the very different approaches of each of the gurus—encompassing value, growth, and quantitative investing—and lays out their philosophy and achievements, detailing step-by-step the secret formulas they used to beat the market, while explaining why these legendary investors consider certain factors to be so important when analyzing individual stocks. Reese not only discusses the individual gurus, their strategies, and why they are important, but he also explains how to best use these strategies in the real world, showing how to sift through all of the choices to find a strategy that works for you. The model portfolio system that the author has developed turns each strategy into an actionable system, addressing many of the common mistakes that doom investors to failure. In addition to offering these individual guru-based models, Reese also explains how to combine and implement these approaches into a multi-guru system that will provide you with a comprehensive, practical stock investing strategy with a proven track record. He reveals when you should buy, when you should sell, how many stocks you should own, and much more. All investors can learn from the thinking, writing, and experience of Wall Street's greatest investors. The Guru Investor, and its free companion Web site—www.guruinvestorbook.com—will teach you the lessons of these greats and give you all the tools needed to put those lessons to work in your investment strategy.
Acknowledgements ixIntroduction xiPart 1 Why You Need this Book 1Chapter 1 Learn from the Worst 3Chapter 2 The Cavalry Arrives 19Part 2 The Value Legends 31Chapter 3 The Granddaddy of the Gurus Benjamin Graham 33Chapter 4 The Investor's Investor John Neff 55Chapter 5 The Great Contrarian David Dreman 73Chapter 6 The Greatest Guru Warren Buffett 95Part 3 The Growth Legends (With a Value Twist) 127Chapter 7 The Star "GARP" Manager Peter Lynch 129Chapter 8 The Price-Sales Pioneer Kenneth L. Fisher 155Chapter 9 The Conservative Growth Investor Martin Zweig 175Part 4 The Pure Quants 197Chapter 10 The Quintessential Quant James O'Shaughnessy 199Chapter 11 The Man with the Magic Formula Joel Greenblatt 219Chapter 12 The Undiscovered Academic Joseph Piotroski 233Part 5 From Theory to Practice 247Chapter 13 Putting It Together: The Principles of Guru Investing 249Chapter 14 The Missing Piece: Determining When to Sell 269Conclusion Time To Take The Wheel 279Appendix A Performance of Guru-Based 10-and 20-Stock Model Portfolios 283Appendix B Guru Yearly Track Record Comparison (Actual or Back-Tested Returns) 287References 295About the Authors 303Index 305
