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The Most Important Thing: Uncommon Sense for The Thoughtful Investor MP3 CD – Unabridged, March 8 2016
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Howard Marks, the chairman and cofounder of Oaktree Capital Management, is renowned for his insightful assessments of market opportunity and risk. After four decades spent ascending to the top of the investment management profession, he is today sought out by the world's leading value investors, and his client memos brim with insightful commentary and a time-tested, fundamental philosophy. Now for the first time, all listeners can benefit from Marks's wisdom, concentrated into a single volume that speaks to both the amateur and seasoned investor.
Informed by a lifetime of experience and study, The Most Important Thing explains the keys to successful investment and the pitfalls that can destroy capital or ruin a career. Using passages from his memos to illustrate his ideas, Marks teaches by example, detailing the development of an investment philosophy that fully acknowledges the complexities of investing and the perils of the financial world. Brilliantly applying insight to today's volatile markets, Marks offers a volume that is part memoir, part creed, with a number of broad takeaways. Marks expounds on such concepts as "second-level thinking," the price/value relationship, patient opportunism, and defensive investing. Frankly and honestly assessing his own decisions—and occasional missteps—he provides valuable lessons for critical thinking, risk assessment, and investment strategy.
Encouraging investors to be "contrarian," Marks wisely judges market cycles and achieves returns through aggressive yet measured action. Which element is the most essential? Successful investing requires thoughtful attention to many separate aspects, and each of Marks's subjects proves to be the most important thing.
- LanguageEnglish
- PublisherAudible Studios on Brilliance Audio
- Publication dateMarch 8 2016
- Dimensions17.15 x 13.97 x 1.27 cm
- ISBN-10151138347X
- ISBN-13978-1511383479
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About the Author
Product details
- Publisher : Audible Studios on Brilliance Audio; Unabridged edition (March 8 2016)
- Language : English
- ISBN-10 : 151138347X
- ISBN-13 : 978-1511383479
- Item weight : 99 g
- Dimensions : 17.15 x 13.97 x 1.27 cm
- Best Sellers Rank: #1,947,301 in Books (See Top 100 in Books)
- #5,010 in Decision Making in Leadership
- #5,211 in Business Decision-Making & Problem Solving (Books)
- #7,853 in Introduction to Investing (Books)
- Customer Reviews:
About the author

Howard Marks is chairman and cofounder of Oaktree Capital Management, a
Los Angeles-based investment firm with $80 billion under management. He
holds a Bachelor's Degree in finance from the Wharton School and an MBA
in accounting and marketing from the University of Chicago.
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Top reviews from Canada
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But then it actually got better. The book mixes general commentary with bits from letters going back several decades.
Some of the commentary does actually go deeper than the platitudes and give you useful reference points. For example one part shows how investors may stretch the limits of risk in unusual assets even while they are avoiding the stock market, so you won't see a general euphoria. Another idea in the book that I realized some time ago but almost no one says is that investors commonly think higher risk investments will deliver higher returns, but if that was true they wouldn't actually be higher risk. Sometimes you just lose.
The parts from past letters are interesting because you can compare the way of thinking with what was happening at the time. Some show timing that's too good to be true, like a letter in October 2008 that said it was a good time to buy. Others are a bit early, like other letters from 2004 - 2006 that call out excessive risk in the market. All of them are interesting because we know what ended up happening.
It would have been even better to see specific instances from past letters that turned out to be wrong. There is some discussion about how the right call may have the wrong result and vice versa, and the book doesn't really go to great lengths to make it seem like Marks is always right, but there could be good lessons in showing more of the other side.
To the uninformed investor this book could deliver the wrong lessons, or a false sense of certainty about the future. It does warn against that, but that warning is more likely to be received in the right way if you have read a lot about investing already. And the basic lessons are repeated in hundreds of other books.
If you have that frame of reference you should know to question everything you read, no matter who it comes from (Warren Buffett's annual letters have very few flaws, but this is not on the same level). From that perspective, if you're willing to read through some material that is a waste of time, there are some valuable reminders in here that will make you question your thinking in a good way.
Those are good enough to give it 4 stars, even though it can be misleading to beginners and slow for more experienced readers. It could have been written better for one of those audiences instead of falling in the middle and serving both poorly. It is unfortunately easy to take the wrong lessons from the book.
Great complement to Howard Marks memos.
Top reviews from other countries

The book addresses topics like market psychology (go against the crowd at extreme ends of investor psychology), the asymmetrical relationship between gains vs losses (you need a 100% gain to recover from a 50% loss), estimates, economical cycles, behaviour, risk management. And the differences between loser's game and winner's game, or the difference between offense and defence.
The book is more a collection of market comments and thoughts from his frequent letters and a memoir of his career. Each chapter is fairly brief and informative, although my thoughts drifted away with a certain frequency in the first half of the book. All in all it is a decent recap but not overly revealing. If you fail to realise you need to take risk, be contrarian and that you need come up with unique ideas to generate excess performance as an investor you would have been ramping up losses or been out of business soon.
As an style-agnostic active equity fund manager of a fairly sizeable pool of AuM I didn’t always agree with the author’s arguments as a value investor. But it was helpful to see some basic principles phrased. And I developed more sympathy towards the end of the book, but more so because it's there that the author alludes more to core principles that I and my team have stuck to for the past few decades. But there wasn't anything new or that we haven't brought in practice. As such it's more an instruction for new or retail investors about how successful asset mangers think, act and operate. But then you wonder what they would do with the concept of ‘alpha’ or where they would get their unique insight or ‘second level of understanding’ to make proper investment decisions.. Also all these concepts are helpful and meaningful but don't expect to learn 'how' to invest i.e. there is nothing about the what the author calls the 'micro approach' the selection and actual analysis of assets and investments, while he repeatedly tresses that such fundamental research and analysis is key to successful investment returns.


Reviewed in the United Kingdom 🇬🇧 on March 29, 2019
The book addresses topics like market psychology (go against the crowd at extreme ends of investor psychology), the asymmetrical relationship between gains vs losses (you need a 100% gain to recover from a 50% loss), estimates, economical cycles, behaviour, risk management. And the differences between loser's game and winner's game, or the difference between offense and defence.
The book is more a collection of market comments and thoughts from his frequent letters and a memoir of his career. Each chapter is fairly brief and informative, although my thoughts drifted away with a certain frequency in the first half of the book. All in all it is a decent recap but not overly revealing. If you fail to realise you need to take risk, be contrarian and that you need come up with unique ideas to generate excess performance as an investor you would have been ramping up losses or been out of business soon.
As an style-agnostic active equity fund manager of a fairly sizeable pool of AuM I didn’t always agree with the author’s arguments as a value investor. But it was helpful to see some basic principles phrased. And I developed more sympathy towards the end of the book, but more so because it's there that the author alludes more to core principles that I and my team have stuck to for the past few decades. But there wasn't anything new or that we haven't brought in practice. As such it's more an instruction for new or retail investors about how successful asset mangers think, act and operate. But then you wonder what they would do with the concept of ‘alpha’ or where they would get their unique insight or ‘second level of understanding’ to make proper investment decisions.. Also all these concepts are helpful and meaningful but don't expect to learn 'how' to invest i.e. there is nothing about the what the author calls the 'micro approach' the selection and actual analysis of assets and investments, while he repeatedly tresses that such fundamental research and analysis is key to successful investment returns.



And at only 177 pages this "Most Important Thing" is an example that consistent messages (possibly must) be delivered in a short fashion - 95% of what's written about the stocks markets nowadays is a copy-and-paste or a bromide; most is showy and inflated with formulas only a few can understand. Mr Marks effortlessly makes all that literature futile by getting down to the point in every chapter and by not bloating the book with not even one mathematical formula. Those starting in the mysteries of buying and selling shares do have here a wonderful introduction and sound advice at a rate of, at least, one per page. Those out there with investment experience, will still learn something new, without a doubt.
As a coda, I'll recommend three other books that, after Graham's Intelligent Investor and Marks'Most Important Thing, do supply with priceless lessons on shares investment (this is just a short comment, I've reviewed these books individually too):
Peter Lynch: "One up on Wall Street". A lont-time successful fund manager, Mr Lynch is perhaps the most enthusiastic of writers on shares, and manages to transmit this enthusiasm without losing a bit of accuracy. This book is a bit dated. Published in 1989 the "big" companies were then General Elecric, Ford and the big tobacco and these firms are used for the many examples the book contains, but its lessons are as good and useful for the third second half of the XX century as they are now.
John Bogle: "The little book of Common Sense investing". Very short, but packed with sound advice. Also a very successful fund manager, Mr Bogle wrote a pamphlet on staying away from fashions and "trends" - his theory is that following a stock index for decades may sound dull, but it is a guarantee of profit. With very good entries on dividends too.
Philip Fisher: "Common stocks and Uncommon Profits". Even older than the previous two, this minor classic was published in 1960 (one of Mr Fisher's favorite stocks was Motorola, then a transistors maker). It is written in the elegantly sober style of the mid-century and it is full of investment wisdom. As with the previous other two books, it offers no miracle and it states often that investment is a long-term activity.

1. Efficient Market Hypothesis is not completely accurate in certain situations
2. This is because as humans we deal not only with information but also with emotions / psychology
3. Therefore, we need to focus on those assets where there might be divergence from the Efficient Market Hypothesis
4. For that we need a Second-Level thinking, not necessarily contrarian but different from the lot
5. Price is different from Value. Price is a function of fundamentals and market psychology. While Value is mainly a function of fundamentals.
6. The relationship between Risk and Return is not completely linear. Higher Risk entails an element of higher losses too which we tend to ignore assuming a linear relation.
7. A good portfolio considers Risk holistically and balances / hedges it appropriately.
8. Fundamentally, markets operate in cycles. People can benefit from them if they are more attuned.
9. Understand the psychological pitfalls and your own limitations around investing.
10. Appreciate the role of luck which stops you from becoming overconfident.
No wonder, Warren Buffet likes it. Having observed the market, I could relate to many of the ideas mentioned here. This book provides good guidance for anybody who wants to get into investing.

