Blogs & Comment

Quotable guide to passive investing (X)

Here is Part X of the Quotable Guide to Passive Investing. Part I is here. To scroll through Parts II to IX, click on links at the bottom of each page.
Serious MoneyRichard A. Ferri
Real estate is one of the few asset classes that have had a low correlation with stock and bonds.”
“Commodity total return indexes have a low correlation with other asset classes, but they also have historically low returns.”
“For most individual investors the (hedge fund) disadvantages of high cost, low disclosure, lack of diversification, illiquidity of some funds, and poor consistancy of performance far outweigh the benefits.”
A large majority of investment advisors have an ulterior motive, namely, selling investment products that pay them commission and fees.
“The ‘free lunch’ from rebalancing is the essence of Modern Portfolio Theory.”
“During a time of extreme volatility, when you want low correlation between asset classes, positive correlation can increase dramatically.”
Smart and Simple Financial Strategies for Busy PeopleJane Bryant Quinn
“It’s an error to put college ahead of retirement savings, if you can’t afford both. Kids can always get student loans — but banks don’t make retirement loans.”
With just a few index funds, you can create your own well-diversified portfolio.”
“Never concentrate your investments in a single company, especially the company you work for.”
The Smartest Investment Book You’ll Ever ReadDaniel Solin
The vast majority of investors do not need any advisor or broker.”
“It is of great significance (and a deep, dark secret rarely discussed by hyperactive brokers and advisors), that in excess of 90 percent of actively managed mutual funds fail to equal or beat the benchmark indexes over the long term.”
“Once you accept the premise that asset allocation is far more important than stock picking or market timing, your financial life becomes a stress-free walk in the park.”
When you have two asset classes in your portfolio that do not correlate highly with each other, you minimize yur risk significantly.”
Straight Talk on InvestingJack Brennan
Living below your means is the ultimate financial strategy.”
“A broad stock market index fund, a broad bond market index fund, and a money market fund will give you everything you need.”
“Investing with simplicity is liberating because it lets you live your life.”
The point of rebalancing is to manage your risk, not to maximize your long-term returns.”
“For most people, an annual rebalancing is adequate.”
To be continued here.