Markets: A Rigorous Course
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Readings and resources

Core about 5 min

Read first

  1. Damodaran, The Little Book of Valuation (Wiley, 2011): the whole book in a weekend.
  2. Damodaran's free Online Valuation class, sessions 1–11 (intrinsic valuation) and 14–15 (relative valuation, P/E): https://pages.stern.nyu.edu/~adamodar/New_Home_Page/webcastvalonline.htm
  3. This module's 6.1 (reading the annual report), 6.2 (the three statements and cash flow) and 6.4 (return on capital) cover the introductory ground.
  4. Koller, Goedhart & Wessels, Valuation (7th ed., 2020), chs. 2–3 (value driver formula, ROIC and growth).

For depth 5. Damodaran, Investment Valuation (3rd ed., 2012): chs. 7–8 (risk-free rate, ERP, beta), 11–12 (growth, terminal value), 17–18 (multiples). 6. Damodaran, Narrative and Numbers (2017) and The Corporate Life Cycle (2024). 7. Mauboussin & Rappaport, Expectations Investing (revised ed., 2021): the reverse DCF as a discipline. 8. Schilit, Perler & Engelhart, Financial Shenanigans (4th ed., 2018). 9. Graham, The Intelligent Investor, ch. 20 ("Margin of Safety"); Fisher, Common Stocks and Uncommon Profits; Lynch, One Up On Wall Street; Mukherjea, Coffee Can Investing; Prasad, What I Learned About Investing from Darwin; Marks, Mastering the Market Cycle. 10. Berkshire Hathaway shareholder letters: https://www.berkshirehathaway.com/letters/letters.html

Papers

  • Sharpe, W. F. (1964). Capital asset prices: a theory of market equilibrium under conditions of risk. Journal of Finance 19(3), 425–442.
  • Lintner, J. (1965). The valuation of risk assets and the selection of risky investments in stock portfolios and capital budgets. Review of Economics and Statistics 47(1), 13–37.
  • Fama, E. & French, K. (2004). The capital asset pricing model: theory and evidence. Journal of Economic Perspectives 18(3), 25–46.
  • Beneish, M. D. (1999). The detection of earnings manipulation. Financial Analysts Journal 55(5), 24–36.
  • Piotroski, J. D. (2000). Value investing: the use of historical financial statement information to separate winners from losers. Journal of Accounting Research 38 (Supplement), 1–41.

Data and tools

Indian case sources

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