So I was looking for books to read on the stock market of Nepal, and this particular book was the first one I found. This book is very popular, and the author has written many other books in both English and Nepali languages.
The book is How to Invest in Stock Market by Rabindra Bhattarai.
Because of its popularity, I wanted to see what was inside the book. Also, having written an ebook on the same topic, I was curious. So I bought the book. It was a small book (around 100 pages), so it took me less than an hour to complete it.
In this article, I want to briefly review this book, including the book’s contents, who should read it, what you will learn, some shortcomings, etc.
‘How To Invest In Stock Market‘ by Rabindra Bhattarai
This book contains the basic terminologies, definitions, and brief explanations of the capital market of Nepal. It is a book for beginners who want to learn about the stock market of Nepal.
You will learn the basic idea about how the stock market works. Mr. Bhattarai has clearly explained the concepts of primary and secondary markets. Further, he has also provided information on what investors need to learn before investing in these markets.
Additionally, the book also provides information on the Nepal Stock Exchange (NEPSE), Securities Board of Nepal (SEBON), Central Depository System (CDS), and other governing bodies of the market.
In the final chapter, Mr. Bhattarai has explained his concept of 3i in investment—information, interaction, and investment. It is a good learning concept for beginners in the stock market.
Overall, the book is a good read to understand the basic terminologies and concepts of the financial market of Nepal.
Who Should Read It?
This book is for beginners who have little or no knowledge of the stock market. It is for newbies and aspiring investors who are curious to learn about investing.
It is not for professional investors. Also, most of the management students might have already learned these concepts in their academic courses. So students who have studied finance in BBS, BBA, or MBA might not need to read this book.
This book is not for you if you are looking for advanced concepts and in-depth knowledge about the stock market and financial analyses.
I, for instance, already knew more than 90 percent of the concepts in this book. It is because I have been investing in the market for years. Only a few concepts and terminologies were new to me. So this book is not for someone like me.
What Will You Learn?
As I said, you will learn the basic concepts and terminologies related to the stock market of Nepal. In brief, you will learn:
- What is the stock market, and how it works
- Primary and secondary stock market
- The concepts of common stock, preferred stock, dividends, bonds, mutual funds, right shares, capital gain tax, etc.
- NEPSE and its history
- Market indexes
- Reading stock tables
- The basic concept of fundamental and technical analysis
- SEBON, CDS, and market regulations
- General investment tips
As this book is for the beginners, there were no detailed explanations and in-depth discussions of the concepts. The title of the book is How to Invest in Stock Market. But to be honest, the ‘how to’ part was missing. It will only teach you about the concepts required to invest in the stock market.
Most of the information used in this book is easily available in academic (finance) books and websites like NEPSE, SEBON, CDS, ShareSansar, etc. The author offers only a few new concepts of his own.
Mr. Bhattarai has explained the concepts of derivatives, short selling, and OTC (over-the-counter) markets. But he has not properly clarified that these are currently not applicable in the stock market of Nepal.
Lastly, he has used many Warren Buffett quotes in the book, which I think is overly done. He could have used quotes from other finance gurus like Peter Lynch, Benjamin Graham, Charlie Munger, George Soros, and more.
Even though the book’s title has ‘how to’ in it, the book is more about understanding the terminologies and basic concepts about the stock market of Nepal. Further, it does not provide detailed steps and processes of stock picking, analyzing, and investing.
Mr. Bhattarai explains fundamental and technical analysis concepts but does not explain how one can learn such analysis. He also fails to explain what criteria investors should check when picking stocks.
Overall, the book is a good read for anyone interested in the capital market. But like I said, if you are already an experienced investor or have been involved in the market for a while, the concepts will not be new to you.
A quick disclaimer: This article is my personal view of the book. I do not intend to influence anyone to buy or not buy this book. This is not a sponsored post (although it would have been cool had this been a sponsored post).