- Paperback: 96 pages
- Publisher: Piatkus (2 August 2012)
- Language: English
- ISBN-10: 0749958898
- ISBN-13: 978-0749958893
- Product Dimensions: 21.6 x 0.8 x 15.9 cm
- Amazon Bestsellers Rank: #2,66,918 in Books (See Top 100 in Books)
The Investment Answer: Learn to manage your money and protect your financial future Paperback – Import, 2 Aug 2012
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The only lecture needed for investing/personal finance
From the Back Cover
Wouldn't it be great if someone could really explain to us the basics we must know about investing in order to insure our financial freedom?
At last, here's good news.
The Investment Answer asks readers to make five basic but key decisions that can lead to safe and sound ways to manage your money. The advice is simple, easy-to-follow, and effective, and can lead to a more profitable portfolio for every investor.
Jargon-free and written for all investors - experienced, beginner and everyone in between - this extraordinary and timely book is all you need to have a successful investment experience.
'Wow! If I could give only one book on investing to my friends, this would be it' Bob Waterman, bestselling co-author of In Search of ExcellenceSee all Product Description
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Most Helpful Customer Reviews on Amazon.com (beta)
I have been a full time faculty member teaching at the college level for the past 35 years and must say that the authors have managed to capture the essence of personal investing in about as few pages as I have ever seen and with a clarity that is very rare in books on this topic. I intend to make it required reading for both my undergraduate and graduate personal finance classes.
I might also add that any negative reviews posted to this site are likely to come from Wall Street brokers who make their living by exploiting the general public's ignorance on investing. These brokers don't like books that clarify and illuminate rather than mystify and obfuscate basic principles. As a lifelong educator, I applaud Goldie's and Murray's noble effort to help readers educate themselves so as not to be fooled by the same Wall Streeters who disgraced themselves in 2008 and nearly destroyed our economy with their greediness. Anyone who feels they don't know enough about investing should read this book. It is a gem.
"The Answer" is not there. Interestingly as the Authors provide investment services; one of the first recommendations is to hire and pay an investment advisor. I'm not necessarily against that for those that can not create a plan and stick with it; I believe anyone who spends $100 on 4-5 good books from the above authors can hopefully create an investment plan, rebalance periodically and ignore the day to day marketing machine.
As an alternative to this book, I might recommend "The Coffeehouse Investor" by Bill Schultheis as a better "primer" to get you on your way. Bill (and the other authors mentioned) also include other recommended reading; though I might suggest The Four Pillars of Investing" or "The Intelligent Asset Allocator"; both by William Bernstein as a second purchase for a deeper dive.
If you're incapable of tearing yourself away from CNBC for a single day or of checking on your portfolios by the hour, this book could lead to a fuller, more rounded and productive life. It covers what is largely familiar territory for those who are aware of the enormous odds against simply matching the market averages and who have learned about "efficient markets" and the advantages of "passively managed," or "index funds," which are always the best bet at staying even with the market while not giving back any earnings to the high-expense funds that trade heavily. It endorses "diversification" but warns against diversifying over narrowly--as some investors are prone to do when their singular success in one technology stock leads to purchase of many more stocks in the same sector.
Perhaps the most surprising statement made by the authors--especially after the public has been constantly teased by prospects of higher and higher gold prices and the virtual "necessity" of having at least 10% of one's life-savings invested in the metal--is the authors' contention that gold, silver, platinum, titanium, hard commodities and agriculture--don't belong in the average person's portfolio, period. Commodities take you out of the earnings stream and and limit positive growth. Above all, capitalism by its very definition means a "positive return" for the economies that practice it. As a so-called "hedge," commodities don't reduce risk, which is what investing should be about: instead, they increase risk, whether in terms of a short-term loss or a short-term gain. Investing in commodities is nothing more than a bet. The authors bluntly say that, in their opinion, investors don't need alternative investments such as commodities in order to have a successful investment experience.
In short, investing is about going on a trip to a place you firmly believe exists and to which you would like to travel. It's not, contrary to the practice of many investors, a game of winners and losers, so why "hedge" against either possibility? Yet some people will buy expensive insurance contracts in the event the trip is cancelled or invest in over-priced umbrellas in the event of rain. If such use of time and money is fun, and you don't mind the extra cost, do it. On the other hand, the authors are saying that if you want to experience worry-free investment success, save yourself all that wasted time and money and make the most out of your short life. At the very least, you'll save not just your money but some precious time and talent to give to those in need. Paradoxically, the person who stands to profit most, is the giver. That's when capitalism begins to run with, instead of against, the tenets of the world's major religions, including Christianity.
The prologue to the book sets up the content beautifully--stating in effect that this book contains information Wall Street doesn't want people to know about.
The book can be read in one sitting. Any investor who fails to take the time to read this book deserves what happens to them when they place blind faith in a Wall Street stock broker (a/k/a "Financial Advisor" or Financial Consultant") who will proceed to treat them like a mushroom.
In case one is not familiar with how mushrooms are raised -- they are grown in dark places and fed great quantities of fertilizer (as in manure).-- an appropriate metaphor for the way Wall Street treats its clients!.
This is a clear, concise explanation of investing for the non-professional. I've already given away one copy and plan to give another. I've read LOTS of bits and pieces, but this puts it all together. Two areas highlighted that aren't well understood: the graph on risk vs asset allocation, and how volatility affects return.
Very slight caveat: I was given the book by an investment adviser, along with some additional material on the authors that somewhat highlighted Dimensional funds (at least one of the authors worked for Dimensional). Dimension investment is a newer indexing strategy that seems to me to be still unproven (the latest analysis I read is that at this point they are not doing better than regular indexes).