Random Walk
by Burton G. Malkiel · first published 1996
62% recommend31% neutral8% critical
Why HN recommends it
Clear, readable overview of market efficiency theory and the arguments for index investing, followed by practical investing steps; widely suggested as a starting point for personal finance and investing.
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…too hung up on getting the absolute best interest rate, just find a place that will give you easy liquidity (ie: DON'T make a 5 year investment right now). Then, buy and read the following books: "A Random Walk Guide to Investing" - Burton Malkiel "The Only Investment Guide You'll Ever Need" - Andrew Tobias (and/or any equivalent titles that catch your interest). Then once you have a good/better understanding…
on “Ask HN: I sold my company last month for $5m. What do I do with the money?” ↗…portfolio for speculating, and experiment with it, but investing for the long-term is the way to go in the absence of something which allows you to escape the financial gravity of the efficient market. A Random Walk on Wall Street by Burton Malkiel covers efficient market theory thoroughly. The Intelligent Asset Allocator by William Bernstein for approaches to constructing long-term portfolios. Lots more to say…
on “Ask HN: How did you learn about stock market/trading investing ?” ↗Having an active money manager working on your behalf costs money that could otherwise be sunk into growth capital in an ETF tracking an index. See Burton Malkiel "A Random Walk Down Wallstreet" for a very detailed and full explanation.
on “Ask HN: How do you pick stocks?” ↗jon_dahl is dead on. Understand Malkiel's Random Walk and the rest is details. But for a really thorough discussion of those details check Investments by Bodie, Kane and Marcus (http://www.amazon.com/Investments-Zvi-Bodie/dp/007293414X/re...). My corporate…
on “Ask HN: Best books/source to learn about investing?” ↗…parent said. You can learn most of what you need to know from these two books: "The Investor's Manifesto: Preparing for Prosperity, Armageddon, and Everything in Between" - William J. Bernstein "The Random Walk Guide To Investing" - Burton Malkiel Do I believe that the market is completely efficient, and that it's impossible to beat it over the long term? Absolutely not. But I do believe that there are very…
on “Ask HN: How did you learn about stock market/trading investing ?” ↗A Random Walk Street by Burton Malkiel. Very easy to understand and entertaining to read too. The book is basically divided into 2 parts, the 1st about the arguments for market efficiency, and 2nd about practical steps…
on “Ask HN: Simple books and resources would you suggest on investing money?” ↗I studied it, got the cfa designation, worked in the field. Yet to see a better, more accurate or more succinct treatment than "A Random Walk Down Wall St" by Malkiel. Can't recommend it enough. Readable. Required knowledge.
on “Ask HN: Book recommendations for understanding financial systems?” ↗…are smart, we invent new things and population increases, then picking the best of what's available is the normal value investors route, a la Buffet as the most famous practioner. Burton Malkiel's "A Random Walk Down Wall St." is still, IMHO the best summary of all the theory and practise of investing - excluding the quant funds like Renaissance. Maybe he has an update for them? Maybe it's also worth reading…
on “Jane Street Market Prediction ($100k Kaggle competition)” ↗…one that's more relevant to the post and will help you start understanding how companies operate at a financial level. For personal finance I have read I Will Teach You To Be Rich by Ramit Sethi and A Random Walk Down Wallstreet by Burton G. Malkiel. The first sounds "click-batey" but that's because "I will teach you the boring effective way to manage you're finances" doesn't sell. The latter gets more into the…
on “SpaceX confidentially files to go public at $1.75T, reports say” ↗…one that's more relevant to the post and will help you start understanding how companies operate at a financial level. For personal finance I have read I Will Teach You To Be Rich by Ramit Sethi and A Random Walk Down Wallstreet by Burton G. Malkiel. The first sounds "click-batey" but that's because "I will teach you the boring effective way to manage you're finances" doesn't sell. The latter gets more into the…
on “SpaceX confidentially files to go public at $1.75T, reports say” ↗Here's what bothers me. Ten years ago I was still in school and came across Malkiel's 'A Random Walk' book. Then I started reading Graham's 'Intelligent Investor' and was like "dude I'm not going to spend hours a day trying to potentially beat the market by 2%. lol I'm not Peter Lynch". I concluded…
on “Fiduciary Rule Fight Brews While Bad Financial Advisers Multiply” ↗The argument against market timing I've always liked comes from Malkiel's Random Walk: > During the decade of the 1980s, the Standard & Poor's 500 Index provided a very handsome total return (including dividends and capital changes) of 17.6 percent. But an investor who happened to…
on “The best investment advice you'll never get” ↗* Steve Jobs biography. I couldn't put it down and I'm shocked there aren't more fans on HN For those who liked Malkiel's Random Walk, read: * Ben Graham's Intelligent Investor * Philip Fisher's Common Stocks and Uncommon Profits They counter Malkiel's thesis (yup, he's wrong) and Warren Buffet credits both men for teaching him how…
on “Ask HN: Best book you read in 2011” ↗It's a really approachable theory and contrary to what you'll read in tech message boards - doesn't remotely boil down to "the market can't be wrong". Burton Malkiel (economist most famous for writing "A Random Walk Down Wall St" and being a longtime advisor of Vanguard) has a paper talking about the early 2000's pushback. It gives a good summation / spells out some critiques / offers his reasons for disagreeing:…
on “Robinhood lays off 23% of staff” ↗…although I am not a 100% sure about them being the 'right thing' to do, I am fairly convinced that they are a 'way to go' about learning new things. One thing is clear though (like Malkiel says in his book 'Random Walk Down the Wall Street' -- you become rich slowly, you only become poor fast), you have to learn to be patient -- you are going to get better at things only gradually. Sometimes however, you need a more…
on “How to Learn Efficiently” ↗