# "Your money and Your brain" by Jason Zweig

A reporter at Forbes Zweig is as close as anybody’s likely to come to the investment psychology and according to him humans let emotions rule the investment decisions…

He remembers Black Monday, the October Day in 1987 when the Standard & Poor’s 500 stock index lost 23 percent, making it the single worst day in the history of American Stock Market.

He explores neuroeconomics, a discipline which combines biology, psychology and economics and tries to understand why we make foolish financial decisions. Neuroeconomics experiments have shown that when people put money in foreign markets, the amygdala-one of the brain’s fear centers- kicks in. On the other hand investing closer to home- or, better yet in the company you are most familiar with, your own- generates an automatic feeling of comfort.

The central finding is that the brain is not an optimal tool for making financial decisions. The part of our brain that tells us to act like rational investors tends to be completely overtaken by much more powerful impulses- impulses that make us human.
He makes the usually overlooked point that our risk tolerance is not a fixed thing, but changes from day today, even hour to hour, depending on our mood.

Despite everything, Zweig remains an investing optimist- he still thinks people can learn to resist their emotions- that is what sets apart investing geniuses like Warren Buffett- their ability to ignore their emotions- or perhaps, to use them differently than the rest of us do.

# 'Blue Ocean Strategy ' by W Chan Kim & Renee Mauborgne

Why compete with other firms if you don’t have to?

This book makes a very valid point.

W. Chan Kim & Renee Mauborbne advocate a different approach to strategy: try to create new industries that change the competitive landscape completely. By creating such “blue oceans”- uncontested market space, your firm will be industry leader and will make competition irrelevant. There is no sense in operating in competitive war zones- “red oceans” – if you have a choice.

# "How to read a financial report" by John A Tracy

A concise well written guide that enables you to navigate the income statement, balance sheet, cash flow statement.

Tracy carefully explains how cash statement is developed, how the ststements relate to each other and what each report tells you about the health of the business in question. Be better equipped to understand the financial report of any company including your own.