Timeless strategies for successful investing except the book lacks meaningful strategies unless you consider not investing as one of them. Overall a good book that makes the point, backed by research, just like The Great Mutual Fund Trap, that in no uncertain terms the modern concept of investing is a farce, the individual is not going to win, and the investment markets are to be avoided.
Institutions are not beating the market. The institutions are the market. Professionals win points; amateurs lose points.Expert tennis: 80 percent of points are won, amateurs: 80 percent of points are lost.50 largest, most active institutions do half of all transactions in the market.In the 1970s the market became dominated by institutions that were trying to beat the market. In forty years they now do 90 percent of the business.2.85 percent a year in annual fees for fund management (factor in inflation, taxes, and commissions and its a losers game)
Working effectively is doing the right things.
Constancy to purpose!
To outperform you must be so skillful and so quick that you can regularly catch other professionals making errors – and can systematically exploit those errors faster than other professionals.In the 1960s when institutions did 10 percent and individuals did 90 percent of the trading, large numbers of amateurs were realistically bound to lose to the professionals.
Informationless trading
The 100 largest and most active institutions do 75 percent of trading.Managers that have had superior performance in the past are unlikely to have superior results in the future. Regression to the mean is a phenomenon in physics, sociology and investing.
Market timing
Selection of specific stocks or groups
Changes in portfolio structure or strategy
An insightful, long-term investment concept or philosophy
Qualified personal residence trust
Enables you to transfer ownership of your house to your children and live in your home rent-free for a period of time (such as fifteen years). You save substantially on estate taxes unless you die before the trust matures – while ownership passes to your children.Pg 148
In 1993, the Dow Jones was equal to its inflation-adjusted level in 1928. Sixty-five years was a long, long time to wait to get even.How much of the 95 years gain in the stock market came in the last 20 years? Most of it prior to the 1980s there werent a lot of gains accumulated. And another consideration was that pass-through inflation accounted for a large amount of the perceived gain.
