[.ca] The Only Three Questions That Count: Investing by ... (ISBN 1596591676)

A Landmark:
This is, without a doubt, the single best work on investing I have read to date. Ken Fisher manages +$30B US and has a track record to prove himself. His father he is not, and he breaks down his investment philosophies for combating TGH ("The Great Humiliator" aka The Market). Question 1: What do you believe that is actually false? Here he goes to down on some of our most cherished beliefs. Believe that low P/E stocks are always better? Wrong. Believe that deficits are bad for stocks? Wrong. Fisher shows with empirical data how a lot of the truisms we take for granted aren't exactly true. You may be affronted with a lot of his conclusions... good! Because most people will throw this book out after about chapter 3. Question 2: What can you fathom that others can't? Here he explains how he looks for those hidden things that give him a shot at beating the market. You may remember the price-to-sales ratio... he invented it back in the 70s. While it is now usually fully priced in to the markets, he used it with great success for many years. Some of his beauties he shares include constructing a global yield curve. A global yield curve?! Yes, and he goes on to shows corelation with returns on value vs growth stocks using his global yield curve. Some of these things are so paradigm bursting you may hail Fisher as a prophet. Question 3: What is my brain doing to blindside me now? This is the behavioural finance section. Drawing on a lot of the research in the last couple decades showing that we aren't as rational or markets as efficient as we'd like to believe, he shows us how to pragmatically apply a strategy that can hopefully exclude our tendencies to do very irrational things. Hindsight bias and myopic loss aversion are just a few problems brought up. Not only is this book revolutionary, it is also hilarious. If you fancy yourself a libertarian/capitalist you are in for a few treats. Notable are his many diatribes on the "ineptitude" (to put it lightly) of government. If you are ready for a totally new approach where many of your long-standing beliefs will be challenged, then pick this gem up. After all, he isn't the most successful columnist/money manager in Forbes' history for nothing.