Enterprising Investor Forum

A Random Walk Down Wall Street, Burton G. Malkiel Monday, July 30, 2007

Most people in the financial community would consider this book a classic. The first sentence reads ‘In this book I will take you on a random walk down Wall Street, providing a guided tour of the complex world of finance and practical advice on investment opportunities and strategies’ – and that’s what the book is all about!

In essence, the book gives you a comprehensive investing guide that you can use throughout your lifetime. What really sets this book apart is that Malkiel takes the time, not only to take you through his theories and advice but he also explains other investment strategies out there and why he feels they are not adequate and will fail to succeed over time. Furthermore, he backs up all his claims and opinions with references to comprehensive published research.

Malkiel is a leading proponent of the Efficient Market Hypothesis, maintaining that markets are ‘efficient’ as prices already reflect all known information and therefore are unbiased in the sense that they reflect the expectations of investors about future prospects. However, despite the fact that he bases all his thinking on this theory and that some readers may not agree with him, we feel that he does a very good job at explaining why he supports this thesis and also highlights how variations can occur.

The whole book is extremely insightful and should be read by anyone who is interested in investing or managing any portion of his/her saving but the forth part of the book ‘A practical Guide for Random Walkers and Other investors’, is an absolute must read for anyone who is even slightly interested in the financial world.

Enjoy!