Investing the Templeton Way by Lauren C. Templeton & Scott Phillips
reviewed by John Samuel
A book about the stock market isn't exactly what you would expect to be light reading, but I wanted to read this book in hopes of better understanding how the mysterious (to me anyway) world of the stock market works.
I was pleasantly surprised to find that not only does this book make good on its promise to share some of the insights and techniques of an expert in the field, it was also very entertaining to read, and very accessible to readers like me who have practically no background in business or finance. The authors take a very common-sense, non-technical approach to investing, explained by way of interesting anecdotes and case studies involving Sir John Templeton, a legendary investor with an impressive track record of finding bargain investments for his customers and himself. Although this book isn't intended as Stock Market 101, through the clear and patient explanations of the examples and the circumstances behind them I feel that I did come away with a much better understanding of market basics.
Everybody likes finding bargains, and that's what this book is really about. It describes what makes certain investments bargains, how to spot these bargains in the wild, and even how to predict what kind of investments may become the next bargains long before they are on most investors' radar. It's not just aimed at those few brave enough to do their own trading of individual stocks either, and there is much of interest to those of us whose involvement in the markets is limited to mutual funds traded via financial advisors. In fact one of the encouraging points in the book is that even Sir John himself sometimes invests via mutual funds, provided he finds a fund manager of a like mind. The book gives a good idea of what to look for in a bargain-hunting fund manager or financial advisor, and even recommends some firms that use approaches similar to those covered.
The only thing about the book I would change is a very small organizational point. I would have like to have seen is a division of the chapters into smaller sections, so that those of us new to this field could have a chance to take a mental break and absorb it in discrete pieces, instead of a whole chapter at a time. As it is though the chapters are not too long, and each one tells a complete and very interesting story that is easily finished in one sitting.
I recommend this book to every investor who wants to better understand investing, and perhaps even improve the performance of their own investments.