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on 19 April 2011
One of the most fascinating things about the twelve `pen portraits' that make up the bulk of this excellent book is that the investment strategies used are so vary varied. From Khalid's frenetic day trading, to John Lee's long term approach, from Eric's regular meetings and telephone calls with company directors, to Bill's focus on just the raw numbers.

Bulletin boards are full of discussion about which is the best strategy, but the fact that these 12 investors have all made millions using such very different ones would seem to lead to the conclusion that the only `best' strategy is the one that's best for you.

One way in which this book works so well is that for each interviewee, there is quite detailed information about their personal background, which in most cases helps to give a valuable insight into how each one settled on their own `best' strategy.

One small criticism could be that all twelve interviewees are male, and ten of them are between 44 and 56 (the other two are in their sixties), but this is partly mitigated by the fact that within this admittedly narrow demographic there is a large diversity of background.

The book is rounded off nicely with a brief and interesting chapter in which the author summarises his research and offers his own conclusions.

I would thoroughly recommend this book to anybody who is interested in the stock market, or indeed anybody who has ever dreamed of accumulating enough `free capital' to enable them to give up work.
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on 15 August 2015
I had been a professional investor for over a decade when I bought this book. I was slightly dismissive when purchasing it, thinking what could I learn from 'private investors'. Indeed the City often thinks of private investors as 'cannon fodder'!

However not only did I learn that my impressions were wrong; it gave me greater confidence in my own processes and methods. Furthermore, one of the individuals interviewed in this book has become a personal friend.

Guy Thomas, has in Free Capital, created a 'Market Wizards' covering private investors, some of whom frankly are as astute and sharp as anyone in the City. I would recommend reading this book with a highlighter and marking some of the quotes. There are some fantastic insights into financial markets and trading. Indeed, by risking their own money day in and day out I would suggest that these individuals have more clarity on how and why stocks go up or down than many institutional investors.

Perhaps the greatest praise I can give is that I have recommended this to members of my own family who are interested in investing in the markets. I would strongly recommend this for both private investors and professionals.
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on 6 April 2013
I really ought to give this 4 stars but it is verging on a 5 so here we go. Great intro into the minds of some very successful investors. Well worth the read. Interesting how they all have their own approach and this confirms my view that investing and trading are based on your make-up and character - you just have to find the system that suits your character.

One thing that is clear from all the participants is that none is sitting on a beach sipping martinis and making the odd trade. These people live, eat, sleep and dream companies and work darn hard. It reinforces my view that to succeed in investment it takes hard work, masses of reading and research and a decent amount of guts to follow conviction.
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on 12 May 2017
enjoyable and interesting read about the 12 investors experiences in their gains and loses in stock market, how some of them with health issue determined to be millionaires.
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on 7 November 2015
Very good. A brilliant evaluation/interviews with successful investors with different styles. Quite inspiring on how some of them became and stayed successful investors.
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on 15 June 2011
This book is fantastic. It is written very clearly & is easy to understand. It is not a "quick fix - here's how to get rich book", but a detailed & comprehensive series of interviews with 12 successful private investors. It details their lives, investment successes, failures & subsequently how each has developed their own current investing style & strategies. Each interviewee has their own unique character & Guy Thomas presents an objective report on each & how they learned their skills. It is the objectivity & unbiased nature of the book that I really enjoyed. There are no recommendations like "you should do it like this, or that", but simply a scrutiny of all their different techniques which is indirectly & unexpectedly very educational, motivating & inspiring. I will be re-reading this book again & again. I was also very impressed that all of Guy Thomas's royalties from the sale of his book are going to charity.
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on 7 April 2017
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on 16 May 2011
This is a great book to dip into though you can certainly read it from cover to cover. I found the introductory chapter most useful to start with -- it's an excellent guide to the author's purpose and will help you to find the parts of most interest initially. The author has done extremely well to investigate and extract the thought processes and philosophies of his 12 subjects.

It is apparent from these accounts that there is no Holy Grail of investment methodology. The interviewees are so diverse in temperament and methodology that it becomes evident that there are many ways of being a successful investor/trader and thus it's the person rather than the methodology that is important. These highly successful investors are all clever people, some very highly qualified academically, others not. They are all highly individualistic and able to make their own decisions, sometimes contrarian but always in their own furrow. Some from humble financial and social backgrounds, they mostly appear to have come to terms with themselves and their lifestyles reflect an equilibrium even though some of them have unenviable medical histories.

The more I read this book the more it fascinates me and in that respect it's like the investment classics of Livermore, Schwager's Market Wizards, & Loeb -- every time you read it another little gem of information or idea becomes apparent. The author excels at explaining in non-jargonistic terms so much useful philosophical and financial discussion. Helpfully, he also includes some clear technical explanations for those wanting them.

This book would make an excellent but modestly-priced present for anyone with an interest in trading the financial markets. Thoroughly recommended and a credit to its author who has donated his proceeds to charity.
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on 5 May 2011
For an investment book this was an unusual pleasure to read. What makes it a joy to read are the wry observations and aphorisms scattered throughout the book, perfectly capturing ideas or observations which I recognised, and yet had never seen written down so clearly before.

The best way I can illustrate this is to type up half a dozen short quotes (fair use):

(p15) "Investment skill consists not in knowing everything, but in judicious neglect: making wise choices about what to overlook."

(p35) "At this stage he was the archetypal part-time trader: the supposedly mercenary activity of trading was really about entertainment, or perhaps a sense of identity."

(p82) "Authorisation for investment advisers is more like a fishing licence than a driving licence. A fishing licence confirms that you have paid a fee, and will not be fined if you are caught fishing. It says nothing about competence."

(p109) "Investment is like swimming or riding a bicycle: difficult to learn without some practical experience."

(p141) "Learning modern portfolio theory to pick investments is like learning physics to play snooker."

(p181) "One wry definition of a value investor: a person who places a high premium on having the last laugh."

(p228) "To the fundamental analyst, technical analysis can seem a sort of cheat sheet, preventing development of proper understanding - and yet often giving infuriatingly good answers."

Anyone with some knowledge of investment and dreams of giving up the day job would find this an inspiring and instructive read. And for the serious private or professional investor, there is a depth of insight which is unusual in a non-technical book.
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on 11 October 2011
Until now I'd not re-read any of my c20 investment books. I'm now starting my third read of Free Capital. Other reviewers have given relatively little coverage to what you might call the "deeper" aspects which make Free Capital noteworthy. Two examples:

1. I was unfamiliar with the concept of holding lots of shares for the purpose of providing liquidity, which is particularly relevant for small caps (all except one of the investors is largely invested in these stocks). There's not much material on how you would in practice "do" the mechanics of small cap investing (there are other books and, again, Free Capital is not a "how to" book) but this is a delicious hint.

2. I had heard of the "Kelly criterion" (Google it and Ed Thorp - it's fascinating) but Free Capital provided the motivation to do some work on this. I can now see how this can in principle play a role in asset allocation. Again more work and thought is required, but it beats a finger in the air or (perhaps) copying others.

Fear not: the more technical aspects are set apart in "panels" (you can come back for them later).

What follows is not really the material you'd normally put in a book review, but I feel compelled to explain Free Capital's impact on me; surely one test of a book's value is whether it makes you change something about your life. The biggest lesson for me from Free Capital is that these successful investors really can explain their approach: what they look for, what would cause them to reject a purchase etc.

The reality is that I was late to the investment party (too busy with the day job) then plunged into the UK stock market. In contrast to the 12 investors, I still do not have coherent buy/sell plans and have not identified any competitive advantage I might have. Free Capital has provided the motivation to put an investment strategy together, which will include a personal (investment) development plan. In my 40s, I do not think it is too late to learn.

I for one suspect that Guy Thomas has much more he could tell us if he so wished; readers might want to Google "diamonds and flower bulbs" and "How many shares should an investor hold?" which will return some fascinating insights into the author's approach to investment from his blog.

Another reviewer noted that all investors were full time and asked what those short of time could do. Warren Buffett is on record as saying index tracking is most suitable for the vast majority of investors. But, to be more precise, what if I have 5 hours free per week? Index tracking, investment trusts or limited active investing? To an extent, I'm still wondering.

Let's end on the positive. This is a fantastic and thought-provoking book. If this is not worth £10 of your money I don't know what is.
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