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Books selected and reviewed by Andrew Allentuck. New Era Value Investing: A Disciplined Approach to Buying Value & Growth Stocks by Nancy Tengler New Era Value Investing is a sophisticated attempt to bring Ben Graham’s Security Analysis from the early 20th century into the 21st. The valuation process that worked in the 1930s won’t work today and price measures have changed, probably forever. The new metrics that Ms. Tengler suggests may not identify the sickest puppies in the market that can surprise everyone and bounce back to life. It can, however, help select sleeping dogs and avoid the mutts. Read the full review The Right Stock at the Right Time: Prospering in the Coming Good Years by Larry Williams Larry Williams, newsletter editor and occasional scribe for publications like Barron’s and the Wall Street Journal, has put together his musings on the market. His approach is situational, his reasoning a kind of back of the envelope sureness that, with patience and some sense of history, things will work out. Read the full review The Eurodollar Futures and Options Handbook by ed. Galen Burghardt In this definitive work on pricing and trading Eurodollar futures, University of Chicago scholar Galen Burghardt, who is also active in the Euromarket, has woven the work of two dozen experienced options and futures experts. The book covers the range of investable assets from Eurodollar time deposits to futures, hedges, swaps and swap hedges. The work is not too heavy on math, at least not beyond what a handheld financial calculator can handle, and the core issue of the book, pricing volatility, is dealt with in a workable form. For investors who want to trade Eurodollar media, this is an essential work. Read the full review Understanding Corporate Annual Reports: A User's Guide by Brian Stanko and Thomas Zeller Accountants have lost their credibility by abandoning their historic role as sniffers of fraud and misrepresentation in exchange for huge fees from audit clients they help to seem more profitable. The authors of this basic, clear, direct, and admirable book begin with the oft-recited litany of crimes against shareholders. They list AOL Time Warner's gigantic write-off of $54 billion of goodwill generated by when AOL, the cash-starved ISP, bought the cash-rich but staid publisher. They list the Titanics of bankruptcy including Global Crossing and Enron and they examine the plague of restatements of earnings by Xerox, Waste Management, and Trump Hotels. They show how the intelligent person can read annual reports and SEC 10-K statements to discern what companies are really doing in spite of the chicanery of auditors paid by clients to make them look good. Read the full review Standard & Poor's Stock and Bond Guide 2003 edition The information in this compendium of stock and bond, variable annuity, closed-end fund, mutual fund and bond tally is a treasure of insight. With data current to the end of 2002, it's as up to date as an annual publication can be. More recent data is available on the Web. Read the full review Real Options Analysis Course: Business Cases and Software Applications by Jonathan Mun Options theory addresses the valuing rights to do things under conditions of quantifiable risk. Real options lie largely in the realm of natural gas and other commodity valuation problems. In this book, incidentally, the most expensive single volume math and markets book this reviewer has ever touched, options theorist Jonathan Mun takes on the problem of valuing such exotica as the American sequential compound option using the binomial or super lattice approach and investigating the implications of boundary conditions on the two-asset correlation call option. Read the full review Quantum Investing by Stephen R. Waite Quantum Investing offers a high risk investment model. The investor who wants to make money, which is the idea, should stick to more mundane concepts like value or growth at a reasonable price. A risk taker, on the other hand, can just take a bankroll to Vegas. At the moment, the odds at craps are better than in investing in the little known. Read the full review The New Investment Frontier II: A Guide to Exchange Traded Funds for Canadians by Howard J. Atkinson with Donna Green National iUnits Marketing Manager for Barclays Global Investors Canada, writes with authority on ETFs, since his firm is a world leader in creating and managing the things. Examining their income tax characteristics, which tend to be benign, estate tax characteristics of ETFs with US assets, asset allocation methodologies and the history of some ETFs, he has produced a book of remarkable authority and clarity. In spite of the detail of this work, it is readable by anyone. Read the full review Getting Started in Bonds by Sharon Saltzgiver Wright Getting Started in Bonds is not the last word in the field, but it is a good first word and for the intelligent novice who is fed up with being ripped off by lousy stocks that fall just after the broker who peddles them has closed the deal, for the person who wants to be able to target an asset balance to begin retirement, or who is just tired of the agony of watching stocks do their crazy dance, it’s a good read. If you want to buy bonds and don't have a track record doing it, get this book first. It could save you a bundle. Read the full review Divorcing the Dow: Using Revolutionary Market Indicators to Profit from the Stealth Boom Ahead by Jim Troup and Sharon Michalsky The Dow has been around for a century and has gone from being heavy with steel companies and sugar refiners to being somewhat techie. Authors Jim Troup and Sharon Michalsky, both of whom are Smith Barney vice presidents, criticize the shortcomings of the index by noting that it is out of favour with the young and the restless who will be the investors and the market in a few decades. Read the full review Crash Profits: Make Money When Stocks Sink and Soar by Marvin Weiss Investment performance measurement is supposed to reveal how an asset, typically a portfolio of stocks, has made out when compared with indices, peers, market or sector risk, and standardized statistical tests of volatility. This book, a very readable, low math approach to the subject, is aimed at preparing data for compliance with standards set out in January, 2002 by the Association for Investment Management and Research (AIMR). If a portfolio thrives or withers, Investment Performance Measurement can explain why it has happened. Read the full review Investment Philosophies: Successful Strategies and the Investors Who Make Them by Aswath Damodaran This work is destined to be a classic. For any investor concerned with the validity of an investing methodology from deep value to no-holds-barred price momentum, Investment Philosophies is an essential read. Read the full review The Technical Analysis Course by Thomas A. Meyers The investor who wishes to learn technical analysis will get his or her money's worth out of The Technical Analysis Course. Making it predictive is another issue. Read the full review Investment Performance Measurement by Bruce J. Feibel Investment performance measurement is supposed to reveal how an asset, typically a portfolio of stocks, has made out when compared with indices, peers, market or sector risk, and standardized statistical tests of volatility. This book, a very readable, low math approach to the subject, is aimed at preparing data for compliance with standards set out in January, 2002 by the Association for Investment Management and Research (AIMR). If a portfolio thrives or withers, Investment Performance Measurement can explain why it has happened. Read the full review Winning the Loser's Game: Timeless Strategies for Successful Investing By Charles D. Ellis Mr. Ellis' wisdom comes down to this: If you have decade to go before retirement, buy a major stock index, hold it, ignore transitory news, have faith, and hope you are not in a period of awful returns. If you are, you have the pleasure of knowing that professional managers who charge 1.5 per cent of assets in U.S.-based mutual funds and about 2.5 per cent of assets under management in Canada, will do little better. Read the full review The Four Pillars of Investing: Lessons for Building a Winning Portfolio by William J. Bernstein This is opinionated stuff written by a man of immense knowledge and an acid wit. He's a knight in shining intellect for the ordinary investor, enemy of managers with high fee funds, exposer of idiocy, and, above all, a market theorist who is due to become a legend. As an investment thinker, he is in the same class as Warren Buffet and even of Ben Graham. The beginning investor can read this with benefit and even very experienced investors will find much value in what Dr. Bernstein has to say. Read the full review Standard & Poor's Mid Cap 400 Guide 2002 edition The investor who wants to buy U.S. mid-caps has to have this book. And given the extent to which U.S. large caps have been discredited by questionable accounting, it may not hurt to shop in a market in which firms are usually too small to be anything but transparent. Read the full review The Ever After Effect: Waking Up from the Boom Years by Linda Nazareth Readable and enriched with interviews Ms. Nazareth has done on RoB television, The Ever After Effect presents the view of the Canadian economy as it was last year looking ahead. Prospects have brightened since then for a recovery. Yet the economy and investors remain on tender hooks. As always, Canada needs the help of exports and perhaps - though she dismisses it - the efficiency of using the US dollar for a currency. Even if you don't agree, The Ever After Effect is provocative stuff with a well reasoned, scholarly base. It's likely to be one of the best books of the year on the Canadian economy. Read the full review The Complete Idiot's Guide to Options and Futures by Scott Barrie If a person had perfect knowledge of the future, it would be possible to turn a thousand dollars into a million in a few weeks. In fact, commodity markets and financial futures are complex and often traded in such perfect markets that the odds of winning are slim. Investing in futures usually means being counterparty to a bet made by a big bank or commodity dealer and its research department. The professional speculators know what they are doing. The little speculator often does not. But for those who want to try to leverage and the huge potential returns of commodity futures, Mr. Barrie's book is a great beginning. Read the full review Investment Valuation: Tools and Techniques for Determining the Value of Any Asset by Aswath Damodaran Investment Valuation's revised edition couldn't have come at a better time. With markets shocked by accounting issues, the former, tidy agreements on what things are worth have come apart. Aswath Damodaran, Professor of Finance at New York University's Stern School of Business, provides the tools to set things right. Read the full review Sniper Trading: Essential Short-Term Money-Making Secrets for Trading Stocks, Options, and Futures by George Angell For the dedicated or addicted short term trader, Sniper Trading is catnip. Mr. Angell is warm and encouraging, his ideas frequently interesting if not necessarily right. Some of his suggestions are straight out of Las Vegas, e.g., after a big win, reduce your stake so that your gains are preserved. In spite of Mr. Angell's confidence, there is no evidence that anyone has figured out a way to beat the market over extended periods. But if you want to keep trying, read Sniper Trading. Read the full review Standard & Poor's 500 Guide, 2002 edition Given the speed of change on markets and in the fortunes of major firms, asking for more would be too much. Apart from a Reuter's or Bloomberg quote terminal or internet stock services, this is the best single reference work on US big companies. No one active in US stocks should be without it. Read the full review The Financial Numbers Game: Detecting Creative Accounting Practices by Charles W. Mulford and Eugene E. Comiskey With an almost eerie sense of timing, The Financial Numbers Game has come out in the midst of the Enron scandal of hidden losses and accountants apparently collaborating in their concealment. This book, which in a year of smaller scandals might just be a hit with people who think corporate audit is fun, is now a major, must- read expose of fraud. Read the full review Magic Numbers: The 33 Key Ratios that Every Investor Should Know By Peter Temple Magic Numbers will help the average investor to be a better investor. For the price,this is a precious reference work and even a good armchair read. A little oversimplification aside, it's a book almost any investor can read with profit. Read the full review The Bond Book: Everything Investors Need to Know about Treasuries, Municipals, GNMAs, Corporates, Zeros, Bond Funds, Money Market Funds, and More By Annette Thau For a person with a bond portfolio that is anything more than Canada Savings Bonds, or who has units in a bond mutual fund, this book is an essential reference. Read the full review Trading on Volume: The Key to Identifying and Profiting from Stock Price Reversals By Donald Cassidy Read this book as a spotlight on the role of volume in determining price. The reader who accepts the author's argument that volume tells everything will be on shaky ground. Given the intent of the author to prove that only volume matters in determining price, this book should be left to experienced investors to ponder. Read the full review Option Pricing - Black-Scholes Made Easy: A Visual Way to Understand Stock Options, Option Prices, and Stock Market Volatility by Jerry Marlow If you want to see the formula at work, then get this book. Other books explain the equation and some do it in simpler terms. This is the formula without all the math. Marlow has made a valuable contribution to the understanding of contemporary, mathematical finance Read the full review How to be an Index Investor by Max Isaacman This is the best book we've yet seen on investing in the huge range of exchange traded funds. All serious investors should have a look at How to be an Index Investor. Read the full review The Book of Risk by Dan Borge There has probably never been a simpler or easier to understand explanation of Value at Risk investing and management than Dan Borge's Book of Risk. For the serious investor and manager, it's essential reading. Read the full review Stop Buying Mutual Funds: Easy Ways to Beat the Pros Investing on Your Own By Mark J. Heinzl Stop Buying Mutual Funds is both a prophetic book of what lies ahead and a manual for investors who want to keep more of the returns of their money at risk and give less of its to underperforming managers. Read the full review Technical Analysis from A to Z: Covers Every Trading Too... from the Absolute Breadth Index to the Zig Zag By Steven B. Achelis The value of this book to the serious trader cannot be overemphasized. It is a reference any investor should have an consult. Read the full review Handbook of Canadian Security Analysis Edited by Joe Kan Call it not just an education, but an insurance policy with hard covers, Canadian Security Analysis is a basic shelf reference for the serious investor. Read the full review Encyclopedia of Chart Patterns By Thomas N. Bulkowski For the investor who wants to consider trading patterns as well as fundamentals in buy and sell decisions, the Encyclopedia of Chart Patterns is a superbly intelligent, thorough source. Read the full review e-investing: How to Choose and Use a Discount Broker By Rob Carrick, Guy Anderson e-investing is the definitive Canadian manual for how to do it. Don't deal on-line without it. Read the full review