Portfolio Review

  •  

    Questions about your current portfolio or seeking a second opinion?
     
    Speak with one of our
    advisors
    or call 866.545.8816. (New clients only.)
    All other needs, call 800.711.2027.

     

Larry Swedroe's 2009 Reading Recap PDF Print E-mail
Written by Larry Swedroe   
Thursday, 10 December 2009 00:00
Overview: Being an educated investor means seeking information from a number of different sources, including various authors. Larry Swedroe, financial author and director of research for Buckingham Asset Management, reads dozens of books each year and wanted to share his thoughts on some recently published books on investing. These were first published on his Wise Investing blog on CBS MoneyWatch.

The Little Book of Safe Money
There are very few in the financial media whose material I would consider recommended reading. The Wall Street Journal columnist Jason Zweig is one of them, and his new book The Little Book of Safe Money is one you should consider.
 
His latest work adds to his reputation for writing books that not only provide important insights into the winning investment strategy, but are also good reads. This little book is filled with sage counsel from which even sophisticated investors can benefit. Among the pearls of wisdom are three commandments Zweig put in biblical language to emphasize their importance.
  • Thou shalt take no risk that thou needst not take.
  • Thou shalt take no risk that is not most certain to reward thee for taking it.
  • Thou shalt put no money at risk that thou canst not afford to lose.
Zweig shows you how to achieve your financial goals while avoiding the pitfalls most investors fall prey to. His advice includes:
  • Avoid putting your human capital and your financial capital in the same basket, meaning don’t hold large positions in your employer’s stock.
  • Own TIPS to fend off inflation.
  • Avoid “newfangled” securities that promise “higher yield at low risk,” “safety with more income” or “returns better than cash with no risk.”
  • Don’t stretch for yield with bonds.
  • Quoting Shelby Cullom Davis: “You make most of your money in a bear market; you just don’t know it at the time.”
  • Avoid leveraged and inverse ETFs.
His book also provides advice on how to avoid many of the behavioral mistakes investors keep repeating. As William Bernstein, who wrote the foreword, put it: “Jason Zweig knows your financial demons, where they live, why they’re making you poor, and how you can beat them.”


Last Updated on Monday, 14 December 2009 14:48