Free Capital (published by Harriman House) simply refers to the money surplus to immediate living expenses; it is the raw material that investors base their work on. The premise of ?Free Capital? is to profile 12 investors who have accumulated £1m or more from the stock market. Beyond profiling the investors, the book reveals their investment approaches and key practical lessons learned. Impressively six have accumulated £1m or more through an Individual Savings Account (ISA).
Author: Guy Thomas (Independent investor since 1999, previously a research actuary and University lecturer)
R.R.P: £18.99 (All author royalties from the sale of the book will be donated to United Nations Stop Tuberculosis Partnership.)
Quote of the book:
?I am always being asked by counterparties, where are my advisors? I often have to answer simply that I have none.? (p. 197)
What we like about the book
+ It is suitable for everyone. Novices will be inspired by the stories as to how people became investors (for example frustrations of their day jobs), while the more advanced will marvel in the practical experiences and tips of the profiled investors.
+ A good blend between ?story? and ?practicality? has been achieved. The profile of each investors provides you with a sense of attachment to the profile, before going to reveal their successes as well as a failures. We call it a ?hybrid model? of investment publishing. The fact that you can associate with the investor helps keep you ?hooked in?.
+ The research method of the book has been well planned. The author has not just plucked random investors, but carefully waited and selected those who have coped with the highs and lows of the market over recent years.
+ It proves that investors do not follow one distinct profile and is inspiring. For example, some investors were involved in electronic engineering, while some were involved with the local government. Some use bulletin boards at a frightening pace, some do not use them at all. Some have low holding diversifications of less than 10 while others have high diversification consisting of more than 50 holdings.
What we don?t like about the book
- Slightly too much ?story telling?. The practical experiences are great when shared, and even more would have been ideal.
- Not the ideal ?first book? for investors. However it is one that could serve as an ideal transition book from theory to practical.
Final thoughts
There was always a danger that in an attempt to appeal to novices and experts alike, ?Free Capital? may have failed to strongly appeal to any demographic. However, after reading the first chapter that fear is quickly dispelled. Novices will feel inspired by the reasons as to why those profiled became investors, while experts will marvel in their experience and tips. Free Capital is definitely a worthy read and is a special type of ?hybrid? investment book that manages to achieve a great balance between story and practical insight.
