These collections tend to be filled with folksy advice on how to save a few shekels here and there. They range from the practical to the absurd: Buy used cars, bring lunches to work, and use a barber college to save on haircutting expense.
As The New York Times noted: "It is no accident that the authors of many of these books come from the stage of motivational seminars and late-night infomercials."
But it's hardly the stuff that makes for great investing.
To be fair, some investing books are worth exploring and considering on their own merits. Take, for example, The Little Book That Beats the Market, which has gotten some favorable press of late.I have no problem with the book's main plan: "Invest in good companies when they are cheap." That's certainly one way to pick stocks, and it sure has worked for Warren Buffett. Of course, you also can use a technical method of stock selection. Or you can screen with quantitative data. Or you can rely on fundamentals to make your stock selections. It really doesn't matter how stocks enter your portfolio. As we have shown time and again, stock selection is not where investors run into trouble. Managing the positions after they become part of the portfolio is where people typically discover their investing shortcomings. And that's before we get to a wealth of other important issues, including how and when to make purchases, how much of a given stock to buy (position-sizing), when to add to existing holdings, how to handle bad markets, when to use leverage, how to use options, how to hedge, when to use stop-losses, etc. Here's a challenge I make to you, or Joel Greenblatt, the author of The Little Book That Beats the Market: You pick your best stocks, the ones you have done all the research on and know inside and out. Then give me a portfolio of randomly selected names.