The Most Important Thing, by Howard Marks, provides Uncommon Sense for Thoughtful Investors.
As you might know, Howard Marks is an incredibly experienced investor, and co-founder of Oaktree Capital. To make the book even better, the newest version is annotated by other value investing hotshots, like Joel Greenblatt and Seth Klarman.
So if you’re keeping score…
When you read The Most Important Thing, you get insight, advice and guidance form some of the most proven minds in value investing. To make matters better, the book is easy to read and offers insightful advice that can serve you for your investing lifetime.
So keep reading this book review to see why I’m so glad my friend recommended this book to me.
Why The Most Important Thing is Worth Reading:
The Most Important Thing is, quite literally, a compilation of the most important things in value investing. The book is basically a series of annotated client memos that Howard Marks has written over the years. Each of the 20 chapters addresses one of the “most important things” in investing.
The great thing about this approach to the book, is that each chapter is relatively self-contained. This makes it easy to read on your commute, or quickly pick up and put down on the go. Plus…
Whenever an experienced investor like Howard Marks decides to share his most important thinking, after 40 years of working in the industry, it’s always worth listening. For this reason alone I recommend The Most Important Thing. But beyond that…
The discussions about risk, managing the psychology of investing, and focusing on a margin of safety are worth paying attention to. I can see myself re-reading this book every year or so, just to keep the lessons top of mind.
But that’s not even the best part.
My Favourite Aspect of The Most Important Thing:
In my opinion, the best part of The Most Important Thing, was the way the book focused on the investor thought process. You see, this book doesn’t give a prescriptive formula to help you avoid risk, or find investing bargains. But it does tell you how to think about all of these critical issues.
The reason I like this approach, is because it empowers you to adopt important and proven investing outlooks to your unique approach to the markets. The Most Important Thing actually encourages you to take the objective advice and apply it to your own experience and outlook.
And remember, when you read The Most Important Thing, you don’t just get the opinion of one amazing value investor, you get the insights of four other amazing value managers who offer critical reflections on Marks’ thoughts. Keeping this expert guidance top of mind, and optimizing it to work with your investing approach is sure to be a tailwind for your portfolios.
At this point in the book review, I’d try to find something negative about the book (or at least an area of improvement). But in this case, I don’t have much to say. The book reads well, it offers great advice and it’s something you can keep on your book shelf as reference material for decades to come.
My only caution would be to reiterate the book is about how to think about investing and those key issues that influence performance. That means it’s not a prescriptive methodology you can follow. But for me, this bigger picture influence is even more valuable than a formula somebody else came up with.
Now, let’s wrap this up, shall we?
The Most Important Thing – The Final Word:
The Most Important Thing by Howard Marks is a great value investing book. It really does offer uncommon sense. It’s logical guidance that you don’t hear often enough. For this reason alone, I recommend you take a look on Amazon and buy The Most Important Thing.
If you’re still on the fence, or want a little more information, why not check out the video book review for a little more perspective?