Books about investing take up about 40% of the shelf space in a typical book store section dedicated to personal finance and money. What is the rest of the shelf full with, you ask? Well, adjacent topics such as:
- Economics
- Politics and Futurism
- Autobiographical titles from finance professionals
- Books about budgeting, saving money and living frugally
These are all helpful and can inform our view of the financial world. Still, this article is about the books which are a ‘pure play’ on buying shares and property, i.e. what most people imagine when they think about ‘investing’, as opposed to saving money in a bank account. The best property investment books are what I’m talking about.
The current state of the investment book market
If you look at the bestseller list on Amazon for titles about investing, or you scan the shelf of a local shop or supermarket shelf, you’ll see something quite interesting.
You’ll notice that of the investing titles (the 40% mentioned above the share of the total shelf), approximately half are more than five years old.
The best personal finance books include well-known titles such as:
- The Seven Hour Work Week
- Rich Dad, Poor Dad
- The Money Diet (the UK only)
- The Intelligent Investor
- How to Think and Grow Rich
I’ve just listed a handful off the top of my head, but if you studied the shelf very carefully, you’d notice this pattern is quite different to other topics.
Consider autobiographies, cooking books, or books about sports. These titles ‘churn’ on a much quicker basis – the share of those shelves taken up by titles published in the last few years is a much higher proportion. Barely any will be over five years old, and none will be older than 20 years old.
Yet, to use my list above, both The Intelligent Investor and How to Think and Grow Rich was written before the second world war. Incredible, isn’t it?
The ‘ageing’ of the investor bookshelf suggestions a couple of wild notions:
- That there’s nothing new in the world of investing. That the concepts, behaviours and phenomena which existed 50 years ago still exist today, and therefore old advice is still good advice.
- What authors have lost their way in producing single titles with the ability to stand the test of time.
Let’s begin with that first notion. Is anything new in the world of investing? Is there any value in seeking out the best personal finance books published this year, or would books printed in 1937 still be just as useful today?
Well, from a practical perspective, beginners guides to investing must be constantly refreshed. An investor needs to understand a great breadth of topics which include information which quickly falls out of date, such as:
- Tax rules
- Categories of investments (local laws and legislation often drive these)
- Types of investment accounts (innovation is creating new platforms all the time, such as spread betting, online trading, fund supermarkets)
So, I’m not at all convinced that there’s nothing new under the investing sun. However, I will say that the general principles of financial markets have not changed. Supply, demand, and the psychology of investing are more-or-less permanent fixtures. Therefore, to the extent that a book focuses on these topics, it will remain evergreen content.
Secondly – are new authors simply not as effective as old authors? I highly doubt this. What I thought has happened is that the market is now flooded with hundreds of investment authors every year. This was not the case back in 1937 when Napoleon Hill penned his classic title.
This means that a new author today faces an uphill battle in even grabbing a tiny slice of the investment book market. Without traction, why would the book remain on shelves? Older books, on the other hand, can claim bestseller status and quote the millions of copies sold over this year. This gives an advantage to the incumbent and sustains the book sales and justifies its position in the book store for years to come.
