The Neatest Little Guide to Stock Market Investing

In chapter 1, he defines all the terminology you'll encounter in stocks. In a very readable manner, he quickly covers EPS, P/E, PSR, ROE, Beta, and numerous other concepts that are useful.

In chapter 2, he describes the methods of 6 all-time top investors (including: Buffett, Lynch, O'Neil, etc.) comparing and contrasting there methods.

In chapter 3, he explores what some historic evaluations of stock growth show. This is great stuff, especially during a down market.

In chapter 4, he explains in detail the Dow Dividend Strategy. Anyone can understand this and with only 30 minutes of work per year have a relatively successful investment plan.

In chapter 5, he covers the process of choosing a broker and placing orders.

In chapter 6, he covers some of the many methods you can use to research stocks. With a ton of web-sites, newsletters, and books, Kelly's advice can save you countless hours wasting time looking for information from the wrong source.

In chapter 7, he explains his own strategy. With easy to understand worksheets and using the knowledge gained earlier in the book, he guides you into an investment plan that will suit you.

Not only is this book full of good information, but it's written in a very readable manner. I highly recommend reading this book BEFORE making another investment decision. Even if you have a broker that you like, you owe it to yourself to educate yourself with this book.


Clear, Concise, User-friendly   January 16, 2000
Michael L. Perla (Smyrna, GA USA)
128 out of 130 found this review helpful

If you've never read a book about investing in the stock market, this is a great book to start with. Having read many of the authors that Jason cites, I found his distillation of their concepts quite good. Jason first teaches one how to evaluate stocks, and then what the Master Investors (e.g., Buffett, Fisher) can teach us about investing and stock selection. Jason also focuses on a book entitled "What Works on Wall Street." This book by James O'Shaughessy revolves around his study of 43 years of results from 1952-1995 contained in Standard & Poor's Compustat database. Jason's book ends with chapters to help you set up your own core portfolio utilizing the methodology he has set forth.

Bottom line: if you're looking for a thorough discussion of the Capital Asset Pricing Model or the Equity Premium, then I would look at more academic texts, but if you want a clear, user-friendly, well-researched discussion of the stock market, I would buy this book. The average 5 star review from 25 people (as of this review) is substantial evidence to this book's value.


Good Basic Guide for Beginners   June 24, 2006
Q (my office)
51 out of 53 found this review helpful

First of all, Kelly's writing is very witty and entertaining. He has a gift for explaining complex issues in simple and easy to understand langauge. The title describes this book perfectly. Kelly is very concise: long on practical advice, without a lot of dry theory and argument. He covers the basics and terminology of Stock investing well; this book is an excellent introduction to stock market investing for beginners. There is a valuable chapter in which he summarizes the investment methods of some of the most successful and famous market wizards such as Benjamin Graham, Warren Buffett, William O'Neil and others. Kelly reviews the main factors that are essential for evaluating a potential stock purchase. I liked the chapter that reviews the available investing magazines, websites, databases and software. Finally he gives a practical method for finding the best stocks out there: A list of important criteria, where to find those criteria, and how to interpret the data you find.

There are some parts of his book which are not too great, such as his heavy emphasis on the "Dogs of the Dow," a rather well-known and out-moded strategy, and his idea that the UltraDow fund UDPIX is your best core fund holding is just plain CRAZY. This fund is very volatile, with a Beta of 2.07, more than twice as volatile as the market, and an Alpha of -5.78, which means that the risk you take on is very poorly rewarded. For a core fund, try something like Oakmark's Equity and Income OAKBX, or Vanguard's Windsor II VWNFX. Kelly must have some sweetheart deal with Profunds, since they are the only mutual funds he recommends. The so-called "Ultra" funds he recommends are extremely volatile.

He has a website too, which gives a weekly overview of market conditions and advertises his newsletter. In his book, he claims that the website will give you all kinds of important information and tips for free; but not anymore: his newsletter costs $5.50 a month (admittedly, this is cheap for an investment newsletter, most of which cost $10-30 a month). In his book, he makes fun of all those advisors who think they can forecast the direction of the market. But then, on his website, he makes statements like: "I expect a rally in early summer, a sell-off in Aug/Sept, and an end-of-year rally into 2007." Listen, folks, you might as well get a Ouija board if you want to forecast the general direction of the market. The direction of the market depends upon events that haven't happened yet. Kelly knows this, and points it out in his book, but then he still goes on to make absurd statements like that. Worse, his predictions commonly prove wrong.

OK. I subscribed to his newsletter and can now report on that. I was very disappointed. He recommended some real losers, and I discontinued my subscription. CTHR, AMD, BSX, the list goes on and on. He likes stocks which are "on sale," but he ignores that these stocks are on sale for very good reasons. Just because a stock has plunged 50% in 6 months is not a good reason to buy! Another problem I had with the newsletter is that he's too focused on just a few sectors, especially tech stocks. AND the newsletter tends to focus on big blue chip stocks like Disney, Microsoft, or Intel. I don't need to pay someone to point out stocks like that to me! Sometimes months go by without any new recommendations. The newsletter commonly consists of a rehash of market conditions that one can find at almost any financial website. There are some good newsletters out there, but this isn't one of them. Maybe things have changed since I discontinued my subscription, but that was my experience.


Don't Miss This One!   February 20, 1999
36 out of 36 found this review helpful

I can't write enough about this book. It covers so much in such a tiny amount of space that I found myself flipping back through the pages just to see how I learned it all. The word economy here is unbelievable. It teaches much more than books three times its length. The truly magical part about Kelly's writing is that it never gets boring. It's funny, instructive, convincing, and thorough. This book will not only get you ready to make big money in stocks, it will teach you how to write well. The part I enjoyed most was the section about market volatility. Kelly tells the story of Intel in 1994 when its chip failed certain math calculations. He showed how foolish investors abandoned the stock when nothing fundamental had changed. In the end, they needlessly lost money. You will never lose money after reading this book. Instead, you'll understand how to use fluctuations to your advantage and always come out ahead. This should be the first investment book on anybody's list and should be re-read every year. As you can tell by now, I loved this book!


It really is the neatest little guide   August 5, 2006
Steve Burns (Nashville, TN)
23 out of 23 found this review helpful

I bought this book due to its 5 star rating after 125 reviews, and it did not disappoint. It really is the neatest little guide because the author covered all aspects of beginning to invest in the stock market. Here is what you get:

1).Learn how the equity market works.
2).Learn how to evaluate stocks, How you judge a stock depends on whether you are a value or growth investor.
3).Learn how the master investors invest. Warren Buffet, Peter Lynch, Gary Pilgrim, William O'Neil, and Phillip Fisher.(I have read all the books he recommends and he is exactly right on these being the masters)
4).He discusses the studies of James O'Shaughnessy from the book "What works on Wall Street" This guy studied what stocks really did the best between 1951 and 1996, this book is a must have. Low P/E ratios and low price to sales ratios have performed the best.
5).He discusses how to double the return of the Dow by investing in the Ultra Dow UDPIX from ProFunds. They use margin to double the return of the Dow in whatever direction it goes. He also discusses many other Dow strategies.
6).Write down why you are investing in a stock so you know when to get out.
7).Choose a discount broker and stop wasting money on full service.
8).Research only 20 stocks at a time, use his stocks to watch work sheet to analyze the stocks value.
9).He explains the limit and market order, and the stop loss and stop order and when and why to use both.
10).He shows when to sell your stocks to lock in gains.

This is a great place to start an education in the stock market, he touches on almost everything a beginner needs to know about. I wish I would have read this book before I read the more technical classics. The author also has a great sense of humor and the book is a pleasure to read while you learn. Stop looking for a book on investing and buy this one.