basic book to read on money/world markets

[lkkubono]

Hi, Investment newcomer here.

I just started my IDECO and Nisa regular account this month. Woot! I'm following what (I believe) it the very basic Boogleheads investment plan of buying Stocks and Bonds split by my age: 60/40. Then within each, I allocated 10% to emerging market fund, 10% to Japan market fund, and 80 percent to A world market fund. More or less those percentages anyway.

I'm trying to educate myself and understand more about investing. I continue to read the US Boglehead site, and RetireJapan. Frankly, it's all pretty overwhelming. Or, it's simple until I am at the point where I actually commit myself by putting money into the accounts. Then I realize how little I know, and start over thinking. For now, I am investing a little.

But I have a chunk of money that is basically sitting in the Japanese Bank making me zero money. I want to invest it, but am still nervous about committing a larger sum, and making a terrible, no-retirement-for-you-until-you're-90 type mistake. Probably nothing new in that, money is scary business:)

So, Hello! I'm asking for recommendations about a (basic?) book(s) to read about how money/world markets work. Basic investment books are good too. Actually, I'd love to hear any recommendations that help(ed) other people start educating themselves along the way.

Thanks very much.

[TokyoWart]

Two good books are the Bogleheads Guide and Bernstein's Four Pillars:

https://www.amazon.co.jp/Bogleheads-Gui ... 1118921283

https://www.amazon.co.jp/Four-Pillars-I ... B0041842TW

[lkkubono]

Tokyowart - Thanks for those recommendations, the Kindle previews will get me started. I appreciate that they are on either end of the spectrum, the boggle head looks more basic and the Bernstein more covers everything, a little deeper, excellent resource. Much appreciated. LKK

[RetireJapan]

Millionaire Teacher is very readable: https://www.amazon.com/dp/B01NADAJ3X
Simple Path to Wealth is available free in blog form: https://jlcollinsnh.com/stock-series/
Random Walk Down Wall Street is good background: https://www.amazon.com/Random-Walk-Down ... 07DP6YGVX/

[adamu]

I think there are two main spheres:

Books about investing in general. These are interesting and good to read.
Books about personal finance. These are probably most effective for an individual looking to invest their own money.

There are also endless blogs. I'll show you my rough journey:

1. The Long and the Short of It: A guide to finance and investment for normally intelligent people who aren't in the industry by John Kay.

This is UK-specific and a bit overly-technical in areas, but I started in the UK and this gave me a good foundation. I think it probably made me a bit too enthusiastic about ETFs. They were pretty new when the book was written, so he pushes them pretty hard. I basically knew nothing before reading this, and it gave me good foundation to start learning more.

That is probably the most general book, and predates the financial independence movement. The rest of the resources have a strong bogleheads / index fund emphasis.

2. The Global Expatriate's Guide to Investing by Andrew Hallam.

I read this because his Millionaire Teacher book comes highly recommended, but I'm not a teacher so wanted something more generic. It's again a good foundation, but his main advice is to use a bank in Singapore. That doesn't work well in Japan, but thankfully we have RetireJapan to discuss the alternatives

3. Blogs.

While not books and so not subject to any kind of editorial checks, I really enjoyed Mister Money Moustache and also jlcollinsnh's The Stock Series. Both US-focused. Mister Money Moustache is highly entertaining and a great read, as well as quite influential. JL Collins kind of sold out on his principals recently, but the older posts are still a good read - he's an evangelical guy and pushes 100% stocks, so make sure it suits you. He also wrote a book, but I've not read it.

[lkkubono]

RetireJapan those look good, thanks.
I've been meaning to check out Millionaire Teacher, now you've motivated me. Free in blog form is always very welcome!
My partner is currently reading the tsumitate NISA book in Japanese that was recommended here and is getting a lot out of it.

[lkkubono]

Adamu, thanks for sharing those and with the context of your journey. Not UK, but Canadian but permanently in Japan. You can imagine how much the information and discussions on this site is helping me move forward. That's 2 recommendations for JlCollins now, it's free, and looks understandable for all. Much appreciating all these responses, thanks everyone. I'll put all the free time for reading to good use.

[jcc]

I think https://www.etf.com/docs/IfYouCan.pdf still gives one of the best reading lists there is.

It covers both the general theory as well as some nitty gritty on portfolios and how rebalancing works to reduce volatility and risk while maintaining gains.

It also has some historic stuff in there which can really help with the panic of big bear runs on the stock market. Some of it(like many books) is US specific but it's pretty transferable if you use the concepts covered.

[LKK]

jcc,
As a noobie, I have 'If you can' in one hand, reading in repeat *) I must admit I've been daunted by the sheer amount of reading he mentions, so I'm just starting with the jlcollins stock series. I feel like I have a solid list to go from after that now, thanks to the RJ group. Cheers.

[StockBeard]

But I have a chunk of money that is basically sitting in the Japanese Bank making me zero money. I want to invest it, but am still nervous about committing a larger sum, and making a terrible, no-retirement-for-you-until-you're-90 type mistake. Probably nothing new in that, money is scary business:)

Maybe books are not what you are looking for, since you already have an iDECO and NISA and have your allocation figured out, you are on the right track. It sounds to me that what you are trying to do here is mitigate systemic risk: typically, one mitigates risks by having bonds and stocks, but you already are doing that yet you are still worried. What I suggest you do is look at what other "buckets" of money you have, that will get you peace of mind: social security is one, your job is another, but it might make sense for you to put a "large" chunk of money in a bank, "doing nothing" if it helps you sleep at night. As a matter of fact, a lot of people have an "emergency fund" that holds 6 to 18 months worth of expenses, and I think it helps with this aspect. You might also want to look into insurance, banks investments, etc... Those will of course not yield the same amounts as the stocks/bond combination, but again they might help you sleep at night. Then it's up to you to decide how much of your money you want to have in those buckets.

As far as books are concerned: I found "the millionaire next door" to be very inspiring, although you don't have to read the whole thing. You get the point after a 3rd of the book, and after that it gets boring IMO. I also found everything from Mr Money Mustache's blog - already mentioned above- in its early days to be very inspiring. His recent content lacks the appeal of the original stuff he wrote, but I don't blame him: the concept of frugality + investment is very simple to grasp and you don't need a full book to do that