Random Walk

What Hacker News says

1. scuff3dApr 2026
   I'm just stating out on this, so I haven't gotten through everything I want to read yet.

   Right now I'm reading Financial Intelligence by Karen Berman and and Joe Knight. There's different versions, but I choose the one "for managers". So far it's done a good job making the material understandable for someone who doesn't have a degree in finance. This the one that's more relevant to the post and will help you start understanding how companies operate at a financial level.

   For personal finance I have read

   I Will Teach You To Be Rich by Ramit Sethi and A Random Walk Down Wallstreet by Burton G. Malkiel. The first sounds "click-batey" but that's because "I will teach you the boring effective way to manage you're finances" doesn't sell. The latter gets more into the weeds on investing. Bother are great (though Random Walk has been edited many times and the beginning of the book has become bloated, so I'd recommend skimming it a bit since it's just history on epic financial crashes).

   I'm planning to read:

   7 Powers — Hamilton Helmer

   Good Strategy/Bad Strategy — Richard Rumelt

   The Outsiders — William N. Thorndike Jr.

   The Intelligent Investor — Benjamin Graham

   The Psychology of Money — Morgan Housel

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2. scuff3dApr 2026
   I'm going to copy/paste a reply I left for another commentor, so I don't have to retype everything lol

   I'm just stating out on this, so I haven't gotten through everything I want to read yet. Right now I'm reading Financial Intelligence by Karen Berman and and Joe Knight. There's different versions, but I choose the one "for managers". So far it's done a good job making the material understandable for someone who doesn't have a degree in finance. This the one that's more relevant to the post and will help you start understanding how companies operate at a financial level.

   For personal finance I have read

   I Will Teach You To Be Rich by Ramit Sethi and A Random Walk Down Wallstreet by Burton G. Malkiel. The first sounds "click-batey" but that's because "I will teach you the boring effective way to manage you're finances" doesn't sell. The latter gets more into the weeds on investing. Bother are great (though Random Walk has been edited many times and the beginning of the book has become bloated, so I'd recommend skimming it a bit since it's just history on epic financial crashes).

   I'm planning to read:

   7 Powers — Hamilton Helmer

   Good Strategy/Bad Strategy — Richard Rumelt

   The Outsiders — William N. Thorndike Jr.

   The Intelligent Investor — Benjamin Graham

   The Psychology of Money — Morgan Housel

   Show morethread
3. harry8Nov 2020
   >But isn't prediction an inherent part of valuation?

   Doesn't need to be. You have wealth you have to store somehwere because it is not being spent now. Can store it as equities, debt (including a bank account), Paper cash money under the mattress, gold bars, BTC, etc etc.

   Let's say you have the list of potential places to store it and can get a price/value ratio but with a common term of "X" in the value

     - A = 3.1/X
     - B = 2.8/X
     - C = 1.9/X
     - D = 4.2/X
   

   Gotta put it somewhere if you aren't spending it. In the above you'd Choose "C". Lowest price to value ratio even though you don't know what the actual value is.

   Yes, this is a massive simplification as it ignores diversification benefits and so on but there's the basics of the usefulness of valuation where you don't and can't know the value.

   "prediction of the market" here means "Do you think the S&P500 is going up or down this year?" Warren Buffet completely ignores this, takes no view on it. Timing the market is very hard. Assuming the market will reflect the economy and the economy will grow because people work hard, are smart, we invent new things and population increases, then picking the best of what's available is the normal value investors route, a la Buffet as the most famous practioner.

   Burton Malkiel's "A Random Walk Down Wall St." is still, IMHO the best summary of all the theory and practise of investing - excluding the quant funds like Renaissance. Maybe he has an update for them? Maybe it's also worth reading if it exists or maybe not. Don't know.

   No idea if renaissance time the market or what.

   edit: punctuation and the Malkiel recommendation.

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4. harry8Mar 2020
   I studied it, got the cfa designation, worked in the field.

   Yet to see a better, more accurate or more succinct treatment than "A Random Walk Down Wall St" by Malkiel. Can't recommend it enough. Readable. Required knowledge.

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5. tinyrick2Nov 2018
   A Random Walk Street by Burton Malkiel. Very easy to understand and entertaining to read too. The book is basically divided into 2 parts, the 1st about the arguments for market efficiency, and 2nd about practical steps in investing considering the conditions explained in part 1. In it the author argued that there is very little chance for anyone to systematically beat the market, and so the best way to make money in the stock market (in the long run) is by following the market (e.g. by buying an index fund).
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6. countJul 2010
   Having an active money manager working on your behalf costs money that could otherwise be sunk into growth capital in an ETF tracking an index. See Burton Malkiel "A Random Walk Down Wallstreet" for a very detailed and full explanation.
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