A wonderfully eccentric guide to successful investing

Book review: The Stock Picker: A Financial History from the Sharp EndIf you’re interested in how the City worked before the Big Bang, you’ll love The Stock Picker, says Matthew Partridge.

Dr Matthew Partridge
By
published
in Features

819-Picker-100

by Paul Mumford

Buy at Amazon

Paul Mumford is not as well-known to most private investors as Anthony Bolton or Neil Woodford, but he has had a very long and successful career of more than 50 years in the City.His most notable success has been as the manager of the Cavendish Opportunities Fund, which he continues to run. Since he first took over the reins in 1988 it has consistently outperformed the FTSE by an average of 2% a year, an impressive performance considering that nearly all fund managers fail to match their benchmarks over five years or more. The Stock Picker tells his story.

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The book is divided into three sections. The opening third recounts how he rose from the position of a runner in an old-fashioned stockbroking firm to becoming a highly regarded analyst, ending with him becoming a fund manager. The second part looks at his career running money, while simultaneously recounting all the major financial, economic and corporate events that have taken place.

Mumford then describes his bottom-up approach to investing, along with a selection of his favourite "baggers" stocks that shot up in value after he bought them. To balance this, he discusses some of his less impressive selections, along with the lessons that they taught him. The Stock Picker is unlike any other City memoir that you might have read in the past. Those looking for a traditional biography will probably tear their hair out in frustration, as Mumford has a tendency to go off on tangents, especially about popular music, another one of his great passions.

However, if you're interested in how the City worked before the Big Bang, as well as life in the 1950s and 1960s more generally, then you'll love it. Overall, this is a wonderfully eccentric and engaging insight into the mind of an extremely accomplished investor.

Dr Matthew Partridge
Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri

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