Comments on: The Random Walk Guide to Investing: Ten Rules for Financial Success http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/ Common sense advice on money saving tips, how to get out of debt, high interest savings accounts, cd rates, money market accounts, mortgage rates, money management and more. Sat, 18 May 2013 18:28:50 +0000 hourly 1 http://wordpress.org/?v=3.0.1 By: typome http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-115611 typome Sun, 03 Feb 2008 06:42:30 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-115611 Thanks for posting this book! I just read a copy from the library, and I enjoyed it. I particularly liked the asset allocation and how to divide my IRA funds. I really didn't know what funds did what, so it definitely helped. Thanks for posting this book! I just read a copy from the library, and I enjoyed it. I particularly liked the asset allocation and how to divide my IRA funds. I really didn’t know what funds did what, so it definitely helped.

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]]> By: Recession-Proof Your Life Before It’s Too Late http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-114327 Recession-Proof Your Life Before It’s Too Late Mon, 28 Jan 2008 10:26:12 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-114327 [...] you have about 30-40 years of investing time.  You could make huge returns, as long as you choose stable stocks from commodity companies who have been in business for a long time (I own this book, it’s good).  There’s also the opportunity to build equity in real [...]

[...] you have about 30-40 years of investing time.  You could make huge returns, as long as you choose stable stocks from commodity companies who have been in business for a long time (I own this book, it’s good).  There’s also the opportunity to build equity in real [...]

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]]> By: Some Thoughts on the Stock Market, the Federal Funds Rate, and Economic Stimulus ? Get Rich Slowly http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-113544 Some Thoughts on the Stock Market, the Federal Funds Rate, and Economic Stimulus ? Get Rich Slowly Wed, 23 Jan 2008 23:27:07 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-113544 [...] I said, “basically nobody knows what the stock market is going to do. I think it’s important to pay attention to the long-term instead of the short-term. In the [...]

[...] I said, “basically nobody knows what the stock market is going to do. I think it’s important to pay attention to the long-term instead of the short-term. In the [...]

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]]> By: Financialgal http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109689 Financialgal Tue, 25 Dec 2007 16:48:27 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109689 Thank you for the review of Burton Malkiel's book. I didn't realize that he had written a follow-up to his "Random Walk Down Wall Street." I had read his first book in college, and I agree, it was a bit dense and somewhat technical. Even though these two books are 30 years apart, it demonstrates that the fundamentals of investing don't change, even through tech bubbles and subprime meltdowns. Thank you for the review of Burton Malkiel’s book. I didn’t realize that he had written a follow-up to his “Random Walk Down Wall Street.” I had read his first book in college, and I agree, it was a bit dense and somewhat technical. Even though these two books are 30 years apart, it demonstrates that the fundamentals of investing don’t change, even through tech bubbles and subprime meltdowns.

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]]> By: Jennionthefarm http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109401 Jennionthefarm Thu, 20 Dec 2007 19:47:46 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109401 I'll add this to my list- I've read a number of your recommended titles, including The Millionaire Next Door, The Wealthy Barber, The Automatic Millionaire, and The Only Investment Guide You'll Ever Need. I'm currently reading The Bogleheads' Guide to Investing. The only books I haven't really read, just skimmed briefly, are the Suze Orman titles. She just doesn't float my boat, I guess. Very self-helpy and Oprahlike. Interestingly, many of your recommended books were checked out the first time I went to the library, which makes sense because that's a great way to be frugal! I'm finding that my knowledge in this area has rapidly outpaced my ability to do anything with it. We have some credit card debt that will be paid off in a year or so and are working on creating emergency savings. I have an 403(b) that I'm switching to a Vanguard IRA and a Roth IRA and plan to contribute more to those and have my husband set up a SEP 401(K) once we actually have money to put in it. I've learned lots from your blog- thanks for sharing your knowledge and experiences with us! I’ll add this to my list- I’ve read a number of your recommended titles, including The Millionaire Next Door, The Wealthy Barber, The Automatic Millionaire, and The Only Investment Guide You’ll Ever Need. I’m currently reading The Bogleheads’ Guide to Investing. The only books I haven’t really read, just skimmed briefly, are the Suze Orman titles. She just doesn’t float my boat, I guess. Very self-helpy and Oprahlike. Interestingly, many of your recommended books were checked out the first time I went to the library, which makes sense because that’s a great way to be frugal!

I’m finding that my knowledge in this area has rapidly outpaced my ability to do anything with it. We have some credit card debt that will be paid off in a year or so and are working on creating emergency savings. I have an 403(b) that I’m switching to a Vanguard IRA and a Roth IRA and plan to contribute more to those and have my husband set up a SEP 401(K) once we actually have money to put in it.

I’ve learned lots from your blog- thanks for sharing your knowledge and experiences with us!

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]]> By: fivecentnickel.com http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109198 fivecentnickel.com Wed, 19 Dec 2007 04:30:44 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109198 A blindfolded monkey, huh? Do you think the blindfold actually makes a difference? That is, would a non-blindfolded monkey fare any better? Probably not. So why bother with the blindfold? When it comes to professional money managers, on the other hand, there's actually evidence that some of them *might* do better with a blindfold than without one. That's right... A non-trivial fraction of investment managers actually do substantially worse than random. Or at least that's the argument presented in The Four Pillars of Investing (an excellent book, by the way). A blindfolded monkey, huh? Do you think the blindfold actually makes a difference? That is, would a non-blindfolded monkey fare any better? Probably not. So why bother with the blindfold?

When it comes to professional money managers, on the other hand, there’s actually evidence that some of them *might* do better with a blindfold than without one. That’s right… A non-trivial fraction of investment managers actually do substantially worse than random. Or at least that’s the argument presented in The Four Pillars of Investing (an excellent book, by the way).

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]]> By: Brad Nolden http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109157 Brad Nolden Tue, 18 Dec 2007 20:09:12 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109157 J.D. I found this blog through Ryan Holiday and have enjoyed the recent articles. The advice in this book is essentially what I learned in four years of studying finance at a decent school. If it were more technical, it very well could be our curriculum. Professors especially love to remind us how unlikely it is that any of us could ever outperform a passive index fund. Probably trying to keep us from delusions of turning into the next Buffet. All the best Brad J.D.
I found this blog through Ryan Holiday and have enjoyed the recent articles.

The advice in this book is essentially what I learned in four years of studying finance at a decent school. If it were more technical, it very well could be our curriculum.

Professors especially love to remind us how unlikely it is that any of us could ever outperform a passive index fund. Probably trying to keep us from delusions of turning into the next Buffet.

All the best
Brad

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]]> By: mapgirl http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109151 mapgirl Tue, 18 Dec 2007 19:04:40 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109151 I've been wanting to do my own review of this book for a while. I love it. I read it in college on the advice of my cousin (a Wharton student) and I guess it's always been part of my subconscious. I haven't re-read it in years, but I will never forget that it's the first place I read about the 'Castles in the Air' theory and that technical chart people are stupid. Thanks JD! I hope you are feeling better! I’ve been wanting to do my own review of this book for a while. I love it. I read it in college on the advice of my cousin (a Wharton student) and I guess it’s always been part of my subconscious. I haven’t re-read it in years, but I will never forget that it’s the first place I read about the ‘Castles in the Air’ theory and that technical chart people are stupid.

Thanks JD! I hope you are feeling better!

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]]> By: FourPillars http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109146 FourPillars Tue, 18 Dec 2007 16:44:50 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109146 If you liked Random Walk Down Wall Street (the book that JD didn't read) then a slightly more academic but better read is Four Pillars of Investing by William Bernstein. Both of those books mainly focus on the relative efficiency of the markets and how nobody can outperform the market so the best way to invest is through low cost index funds and ETFs. Traciatim - I don't think there is a Canadian equivalent but the original RWDWS and 4 Pillars books are generic enough that anyone can enjoy them. If you liked Random Walk Down Wall Street (the book that JD didn’t read) then a slightly more academic but better read is Four Pillars of Investing by William Bernstein.

Both of those books mainly focus on the relative efficiency of the markets and how nobody can outperform the market so the best way to invest is through low cost index funds and ETFs.

Traciatim – I don’t think there is a Canadian equivalent but the original RWDWS and 4 Pillars books are generic enough that anyone can enjoy them.

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]]> By: brian http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109145 brian Tue, 18 Dec 2007 16:43:09 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109145 This is undoubtedly good advice overall, but a small niggling contradiction: #2 says "invest before anything else, even paying bills" while #7 says "Paying off credit card debt is the best investment you will ever make." I would definitely agree with paying off credit card bills first, but this highlights the problem with investment rules that have "never" or "always" in them. This is undoubtedly good advice overall, but a small niggling contradiction:
#2 says “invest before anything else, even paying bills” while #7 says “Paying off credit card debt is the best investment you will ever make.”

I would definitely agree with paying off credit card bills first, but this highlights the problem with investment rules that have “never” or “always” in them.

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]]> By: Josh http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109143 Josh Tue, 18 Dec 2007 16:21:47 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109143 Ryan, that's a good point but it's uncertain that it is the cause of value over-performance. You're getting into the 'why' question I had hoped the book would address in more detail. ;) Ryan, that’s a good point but it’s uncertain that it is the cause of value over-performance. You’re getting into the ‘why’ question I had hoped the book would address in more detail. ;)

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]]> By: Ryan http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109142 Ryan Tue, 18 Dec 2007 16:06:44 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109142 Josh, but simply because one asset class has better returns than another doesn't contradict an efficient market. Efficient markets are all about bringing returns appropriate to systematic risk. I'm sure that's a point you understand, but I thought I'd mention it. Ryan Josh, but simply because one asset class has better returns than another doesn’t contradict an efficient market. Efficient markets are all about bringing returns appropriate to systematic risk. I’m sure that’s a point you understand, but I thought I’d mention it.

Ryan

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]]> By: Brigitte http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109141 Brigitte Tue, 18 Dec 2007 15:54:16 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109141 Your comment in Stiff the Taxman about buying versus renting... I'll admit I do not do my own taxes, but my mom (who does them, for some very good reasons, one of which being I'm still listed as her dependent) pointed out to me a couple years ago that by some tax law, I was getting more taxes back by renting than she was by owning her home and paying a mortgage, by taking my rent payments as a deduction of some kind. I wish I knew the details, but folks should make sure to check into that availability in their state. Your comment in Stiff the Taxman about buying versus renting… I’ll admit I do not do my own taxes, but my mom (who does them, for some very good reasons, one of which being I’m still listed as her dependent) pointed out to me a couple years ago that by some tax law, I was getting more taxes back by renting than she was by owning her home and paying a mortgage, by taking my rent payments as a deduction of some kind. I wish I knew the details, but folks should make sure to check into that availability in their state.

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]]> By: Josh http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109139 Josh Tue, 18 Dec 2007 15:38:07 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109139 I can see how "A Random Walk Down Wall Street" could be a bit technical for new investors. I thought the advice in the book was sound, but the reasoning wasn't compelling. This may have been due to an attempt to keep the book accessible to the general public, but - with a background in economics/statistics and an interest in markets - I was disappointed he didn't mention many arguments that confound the efficient markets hypothesis (e.g. value investing always beats the market over long (3-5+ years) horizons. As I said, no one will be disappointed by following the advice in the book; but I was disappointed by the answers to 'why' the advice should be followed. Best, Josh I can see how “A Random Walk Down Wall Street” could be a bit technical for new investors. I thought the advice in the book was sound, but the reasoning wasn’t compelling.

This may have been due to an attempt to keep the book accessible to the general public, but – with a background in economics/statistics and an interest in markets – I was disappointed he didn’t mention many arguments that confound the efficient markets hypothesis (e.g. value investing always beats the market over long (3-5+ years) horizons.

As I said, no one will be disappointed by following the advice in the book; but I was disappointed by the answers to ‘why’ the advice should be followed.

Best,
Josh

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]]> By: Money Blue Book http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109138 Money Blue Book Tue, 18 Dec 2007 15:31:30 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109138 A lot can be said for #10 and the need to avoid emotional investing. Invest for the long haul and let time and compound interest take its course. A long haul in my opinion is more than 5 years at least. -Raymond A lot can be said for #10 and the need to avoid emotional investing. Invest for the long haul and let time and compound interest take its course. A long haul in my opinion is more than 5 years at least.
-Raymond

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]]> By: Dividends4Life http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109134 Dividends4Life Tue, 18 Dec 2007 14:56:04 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109134 It sounds like a good book. I love good common sense lists - we have to sometimes be reminded of the basics. Thanks for sharing the summary. Best Wishes, D4L It sounds like a good book. I love good common sense lists – we have to sometimes be reminded of the basics. Thanks for sharing the summary.

Best Wishes,
D4L

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]]> By: Traciatim http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109132 Traciatim Tue, 18 Dec 2007 14:23:53 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109132 I couldn't seem to find one, but do you know if there is a Canadian version of this book that doesn't go in to IRA's and 401K's? Since we have RRSPs and lots of different tax rules I find it hard to find good simple investing books. I couldn’t seem to find one, but do you know if there is a Canadian version of this book that doesn’t go in to IRA’s and 401K’s? Since we have RRSPs and lots of different tax rules I find it hard to find good simple investing books.

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]]> By: Eden http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/comment-page-1/#comment-109130 Eden Tue, 18 Dec 2007 14:03:11 +0000 http://www.getrichslowly.org/blog/2007/12/18/the-random-walk-guide-to-investing-ten-rules-for-financial-success/#comment-109130 Interesting. I'll have to check that one out. I am reading A Random Walk Down Wall Street right now. I find it mostly interesting, though often dull. Definitely not for beginners or someone who doesn't plan to manage their own investments. Interesting. I’ll have to check that one out. I am reading A Random Walk Down Wall Street right now. I find it mostly interesting, though often dull. Definitely not for beginners or someone who doesn’t plan to manage their own investments.

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