Wednesday, May 31, 2006

Book Review -- Introducing the Australian Stockmarket

Introducing the Australian Stockmarket
Adam Steen and Keith Kendall

Rating : 5*

This book was clearly the pick of the bunch for an intelligent introduction to the ASX, and trading in general. I say intelligent, because it doesn't bamboozle you with terminology, but introduces things clearly, describing their role in share trading, their history and their meaning. The bulk of the common ASX traded products are covered, and so is the terminology.

The book is split into two sections -- "Shares and the ASX" and "Analysing the ASX". The first part describes the ASX, what a share is, how they may be bought and sold, the sectors and indices of the ASX, leverage and derivitive products, tax, and law. This gives an understanding of how a share is tied to a real company, what a sharemarket is, and what trading comprises.

The second section begins to give an insight into the information surrounding trading decisions. It covers fundamental analysis, financial statements, macroeconomic issues, technical analysis, charting tools and a summary of the usefullness of the various sources of information.

While not enough to formulate a trading system in its own right, it is a useful introduction to what may be done, how, and a little of why. An excellent basis for further learning.



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