Per Marc Andreessen’s recommendation, I’ve been perusing the Wall Street Journal the last few weeks. To say there’s a lot I don’t understand would be an understatement. There are a lot of fundamental things I don’t understand about the world, the stock market, finance, and business. For example, what exactly does the Dow Jones Industrial Average measure? How is it calculated? How does a company get added to that average? What causes stock prices to change? I don’t even understand the concept of buying and trading shares of a company anyway.
Realizing that I need to back up a few steps, I picked up The Guide to Financial Statements which I’m slowly making my way through. Last night I picked up Investing for Dummies. Finally a book written for me!
In retrospect, I’m not sure I’d do it differently. By working backwards and starting at the deep end I have a better idea of what to focus on now that I’m learning the basics. It’s a pleasure getting those “Aha! Now that makes sense” moments. Given that I read a quarter of Investing for Dummies a few years ago and don’t remember any of it, I think this method will help me connect the dots in a more practical, memorable way.