The Art of Execution: How the world's best investors get it wrong and still make millions

Most investment strategy books I have read struggle to convince you because very often the writers are stretching out their story to actually convey very few innovative ideas plus also lack convincing empirical evidence of why their ideas work. This book differs in that firstly as outlined early on it is based on major data obtained from the author overseeing a great number of other leading fund managers applying their best ideas and strategies on his behalf. Many of these case studies based on real companies occur across the whole book. Secondly the key lessons have been stripped down to their basics and organized very simply. The book while 170 pages is widely spaced print and so a very easy read. While covering five different investment styles, the two key lessons for me after reading are: 1. Having a clear strategy of cutting losses on a strictly applied without exception basis for all holdings (by setting maximum percentage loss fall acceptable and set period of ownership to become a winner before disposing of where no fall/growth); and, 2. When winners do occur, be prepared to run them (and sell off immediately as and when the evidence changes). One other approach covered is buying further into a stock as it's price falls on the planned expectation it will bounce back as a winner. While noting the tactic the methods of identifying and applying are not, so one suspects will not be easily applied and executed by many readers of this book! The real skill of the book and why I rate it so highly is that in addition to the well written empirical evidence and analysis, the author in commenting from his own personal observations backs it up with cross referencing in the end notes to the extensive and key evidence on investment and decision making research sources, if any further reading is needed.

Some very valuable research and conclusions. It's often said that the most difficult part of investing or trading is knowing when to sell, rather than when to buy. Using real data from, this book lays out the case for some good exit strategies for losers and winners, to help minimise losses and maximise profits. The top fund managers and investors do get it wrong; that much is clear. Some of them get it right, and the author shows us how. What's interesting is that not one of these top investors used a strategy that's shown to generate even greater returns: that of buying more of what's working as it rises. Warren Buffett did it with Apple, for example, and it has paid off handsomely. However, the author can only report on the data he has gathered, and none of his team did this. There are a couple of howlers. For example, if you've shorted a stock and the price is going up, you do NOT sell it to exit: you buy back to exit. There's also a Tony Robbins quote attributed to Tony Robinson, who is a comedy actor and presenter. The idea of Baldrick as a life-coach is a gem.

This book is both thought-provoking and has changed my behaviour. It is not for frequent traders on the stock exchange, which I am not. It is tightly focussed on what to do after you have bought a share. While it has a few thoughts on stock picking and portfolio make up, it concentrates the mind on deciding in advance what to do when your have done your stock picking, when the share price either goes down more than a few percent (more or less normal market volatility) or it starts and continues to rise . It is impressive in that it is based on hard evidence, not just theory. It is not prescriptive in that each individual will make their own mind up what is the right course of action for them in the light of their investing policy, their temperament and their attitude to risk. Where Lee Freeman-Shor is prescriptive in laying down options, he comes down firmly on the side of the investor making up rules for himself/herself that lead to specific actions of buying or selling in whole or in part as opposed to merely having guidelines which allow the heart to over rule the heart. I sincerely wish that this book had been available years ago. When you read it it makes perfect common sense, or rather, un-common sense, because it is clear that many, perhaps most, professionals either do not subscribe to this approach or certainly do not implement it. There are clearly advantages in having no masters looking over one's investing shoulder. It is a shortish book (190 pages with large type), with many inset case studies and data points, clearly written, concise and precise. If I had been able to read this book years ago and taken on board even part of its sage advice, I would have saved or made myself many many times its cover price. If you don't have established rules in place, to pay about the cost of one online trade for the book is a no-brainer.

This is a must read book for anyone who invests in the stock exchange by buying individual shares. Based on the experience of running a Best Ideas unit trust where well known investors were given a large amount of money to invest in a small number of companies. He saw some live up to their big reputations but others stumbled badly so he started to investigate why by looking at their investments and their trading habits. At its core, there are three things that determine success 1 the proportion of winners to losers 2 what you do when an investment is losing money. 3 what you do when an investment is making money. Do 2 and 3 the right way and you can succeed even if you're not so good at the first. The rules are simple and, when you know them, basic common sense. What gets in the way are a lot of emotions that make it hard to do what you should do. I don't generally invest in shares but in ETFs and unit trusts. The proportion of fund managers who beat the market is low which is why it is often recommended to invest in low cost index trackers. This book suggests that fund managers who have relatively consistent past records are not "just lucky" but have learnt how to execute well and probably use investment rules to help them avoid the emotional reactions that cause people to lose money. It's helped me to think about why a fund manager is successful. ON this basis, I think it's worth reading if you're like me and don't invest directly in company shares. The author admits that many professional investors will read the book but not amend their habits because they have confidence that they know best. Don't think the same. Once you develop these good habits over winners and losers, you can then focus more time learning how to pick more winners than losers. About my book reviews - I aim to be a tough reviewer because the main cost of a book is not the money to buy it but the time needed to read it and absorb the key messages. 5 stars means that I think that overall it has some vital messages in it.

Lee’s book is an interesting addition to the many books available on investing. His focus is on the execution of investments as opposed to the analysis and comparison of stocks. Definitely worth reading!

This was a surprisingly quick read. It provides interesting analysis of results from the habits and performance of experienced traders, learning how they acted and reacted to movements in share prices and results of the shares they owned. 3 decisive actions tend to be identified by traders when a share price moves against them, either they sell up, buy lots more or be like a rabbit stuck in the headlights and do nothing. It tends to be the rabbits who suffer worst and have the poorest performance. I found the book an interesting read and consistent with the extensive online reviews I've read about the book. Will it change my trading style? Maybe not much but I will consider the research before I make a decision, although I will consider many other factors too before buying/selling/sitting still.

If you have been an investor or trader for any length of time, this book will not tell you anything you didn't already know. What makes this book great is that it grabs hold of that known knowledge and throws it back at you. By doing this, it lets you re-learn what you already understand but in a good way. This was a really enjoyable read and I would recommend it to anyone starting out in trading or investing as well as anyone who is already in this field, whether as a professional or someone trading their own portfolio. An easy read over a couple of nights but one to keep on your bookshelf for when you need a reminder of your already known knowledge.

Would be 5 stars except the book I got is missing loads of pages, I got to p116 and page117 to 148 are missing instead page 85 to 116 repeated It is not a stock picking book but more a reminder of the emotional danger of holding something losing too long and winning too short

This is a very good book about some of the behavioural aspects of investing. The author, Lee Freeman-Shor, oversaw a number of professional investment managers that managed portfolios of $25 to $150 million. He then analyzed the results and studied what behaviours led some to be more successful than others. The book is divided into two main sections, the first on what to do when you have a paper loss on an investment and the second on what to do when you have a paper gain. The losing and winning investment sections are further broken down into successful and unsuccessful behaviours in responding to each scenario. These behaviours are categorized into five distinct types, three types of behaviour when a stock is down (one unsuccessful type, and two successful types) and two types of behaviour when a stock is up (one unsuccessful and one successful). The author makes some interesting conclusions. Maybe I haven't read enough of these sorts of books yet, but I found all the recommendations to be counterintuitive yet logical. They will definitely be something I will apply to my own investing going forward (I found a few of the investing mistakes to be things I currently do or have done) Overall it is a short, easy to read book on investing behaviour, written in plain English (not much financial jargon). It covers its subject well and provides examples without overwhelming the reader. It might be too basic for people with advanced knowledge, but I nevertheless think there is still some value to be gained by a read through. I highly recommend it.

It is one of the books I wish I had read earlier in my career as investor. This is one of the best books on behaviour of different styles of traders or investors on the market and also provides solutions on how to overcome the own mistakes. Congratulations on this work!

Important lessons for any money manager

Something all sharemarket buyers should consider.

We all believe that people at top of their fields were born different or are god gifted. It may or may not be true, and we all have to live with what we got. Investing is one key part of managing one’s finances. This book provides simple yet effective habits that could help sustain a good investment profile. Definitely recommended