CM Archive
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Jerry Ackerman and J. J. Brown.

Toronto, Macmillan, c1982.
291pp, cloth, $18.95.
ISBN 0-7715-9557-3.

Grades 12 and up.
Reviewed by Allan W. Kogon.

Volume 11 Number 1.
1983 January.

No single volume can be a comprehensive investment guide. With this limitation in mind, this book is aimed towards a neophyte Canadian investor. The authors have included a chapter on elementary mathematical concepts such as graphing and statistics, and ratios that can be used for investment analysis. After analysing their own financial position, readers are encouraged to raise their initial investment capital through budgeting and taking advantage of RHOSPs, RRSPs and using tax deductible borrowing for investment purposes. Some areas of investing are out of necessity glossed over including considerations of gold, art, coins, stamps, and commodities. There is also an interesting chapter on real estate where Dr. Brown gives the case for this type of investment an3 Dr. Ackerman gives the case against. Perhaps the authors were thinking in a Canada-wide context, but they do not give adequate consideration to Ontario Rent Control Legislation and Ontario Landlord and Tenant law, major concerns in this province.

The main investment discussed in this book is the stock market. The authors use a fundamental approach to financial statement analysis rather than a technical approach based on the analysis of a stock's price and volume chart. Sample analyses are included using several examples contained in the text. I think the authors should have included a typical full financial statement in the appendix to give the reader a more realistic example. Of course, the authors approve leveraging of investments in order to increase profits and, typically, de-emphasizing the fact that leverage also increases losses. Each author was candid enough to describe how they were on the financial ropes at times during their careers because of unsuccessful investments.

All investment books are subject to changes in legislation, and a Canadian book is particularly vulnerable. Two recent budgets have varied the attractiveness of various types of investments, for example, MURBs and films, and the author perhaps should have pointed out more strongly that government intervention can distort any investment decision. In summary, this introductory investment book is good for cultivating an interest in the stock market but must be used carefully so that the user does not get a false sense of security. Includes bibliography, index, and glossary of financial terms.

Allan W. Kogon, Georgetown, ON.
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