Commonsense on Mutual Funds

Rating:
Summary: A classic!
Review: "Bogle on Mutual Funds" was my first investment Bible. This book kicks it up a notch in sophistication of his philosophy. Noone knows what will work best in the investment world next year, but Bogle clearly knows what will work best over the long run. IGNORE THIS BOOK AT YOUR PERIL! The last third of the book is an extremely brave look at the business morals of the mutual fund industry. Thank God somebody is willing to speak up.

Rating:
Summary: A real eye-opener. Excellent.
Review: A book no mutual fund investor should miss. Bogle, long a champion of shareholders, tells it like it is. I learned that I can chase after the next hot fund or simply put my money in a low-cost index fund and watch it grow more reliably. Maybe that's why it's called "Common Sense" on mutual funds. Thank you, Mr. Bogle, for explaining why low-cost indexing works, and for opening my eyes to the perils of mutual fund investing. Forewarned is forearmed.

Rating:
Summary: Avoid the Misconception Stall about Your Investments
Review: A common problem that all of us have is that we believe ourselves to be able to produce superior results in virtually any area we try -- acting on that belief can cost you a fortune if it affects how you invest over your lifetime. By definition, half will be average or less, and half average or higher in most areas of human endeavor. When it comes to investing, however, the odds are not that good. If you choose the wrong asset class, you can make great choices and greatly lag the pack. If you choose the wrong way to invest with the right asset class, you can still do poorly. Mr. Bogle's book explains in remarkable detail (with lots of graphs and numbers to make the point) that almost everyone will lag the market averages for stocks over any multiple year period of time due to the effects of trading stocks, taxes, costs for money management, marketing expenses, and size of portfolio. Rather than despair, he points out that we can view this as an outstanding opportunity. We can simply buy indexed mutual funds (such as the ones that Vanguard, his firm, offers) and outperform 98-99 percent of everyone who invests for the long haul. Unlike other books where the author touts an activity that benefits him economically, Mr. Bogle's arguement is right. For anyone with less investment skill than Warren Buffett, S&P 500 and Wilshire 5000 index funds will be a terrific solution. New investors may find this book to have more information than they need or can easily absorb. People who think they know all the answers will find a lot of new material to cogitate about, usefully. Anyone who owns mutual funds is making a mistake if they do not read this book. Anytime you start to invest on the assumption that you can beat the market easily, PLEASE QUICKLY READ OR REREAD THIS BOOK. THEN LIE DOWN UNTIL THE FEELING GOES AWAY! He is also remarkably candid that future returns from indexing may be modest (even though you will continue to beat almost everyone else). My own reaction is that the market is really too high now to start index investing, but new cash should certainly go into index mutual funds whenever we get a decent correction down to or much closer to the more typical 14 times p/e that stocks usually sell for. Mr. Bogle also explores that point in excellent detail. A wonderful book by someone who is really looking out for the investors' best interests!

Rating:
Summary: Great for people about a year into intelligent investing
Review: Are low expense, low tax index funds are the way to go? The academic studies and charts in this book helped me decide. As soon as I read of a great mutual fund and invest in it, it goes down. Why? Bogle's academic studies prove that the best stock funds will revert to the mean (produce average returns which are generally below those of the index fund's) over time. Those great returns were for yesterday's money not today's. And no academic or stock watcher has been able to successfully pick out hot funds in advance. Their objective records are terrible Ouch! Reverting to the mean appears to be as unyielding as gravity.

Rating:
Summary: One of the best
Review: Before investing any money in any mutual fund, you should be forced to read this book. This is truly a book that will help anyone who is confused about mutual funds get started by bypassing the hype about what fund is hot for today. The general rule of Wall Street when it comes to the individual investor is that by the time you hear about it, its too late to profit from it. This book pretty much explains why. As for it being repetitive, thats only because those points need to be drilled home. COSTS MATTER, a forgotten point when 100% returns are not abnormal. That time has passed and you should be ready for that. Read this book and forget brokers and their commisions...especially when they can look you in the eye and suggest a bond fund with a 4% sales charge and a 1.5% annual expense ratio. When you expect to make 5% yearly in a bond fund, you then should expect 0 return in yr. 1 and you will be paying 30% of your return back to the fund in each subsequent year, unless they can make that percentage up by taking on more risk and, thus, jeopardizing your investment goals. It truly is absurd. I would also suggest What Wall Street Doesn't Want You to Know, and The Intelligent Asset Allocator for more on the subject.

Rating:
Summary: Wisdom repeated to the point of boredom
Review: Bogle has some very compelling points to make that would greatly simplify investment decisions and lower the stress levels of many investors. His main point--buy and hold a low-cost, tax-efficient, no-load, broadly-based U.S. market index fund for the long haul (hint: consider Vanguard)--could have been stated once or twice prominently instead of boringly dozens of times with endless charts and statistics. I also found his references to the stock market and inflation rates dating back to the 1800's to be largely irrelevant given the changes in the nature of the markets and economy since then. While Bogle makes a particularly good point about how management fees really eat into bond fund returns, he doesn't really acknowledge the long-term advantages to holding bonds outright over holding them in mutual funds at all. You can glean Bogle's key points of wisdom with a quick skim of the book; if you need to be convinced over and over and over again from different angles--and many of the same ones--then by all means consider this as good bedtime reading.

Rating:
Summary: Should be required reading for all mutual fund investors
Review: Bogle has written a terrific book that makes its points over and over. Low cost funds, passive investment strategies, etc. His statistics, and we know they can always lie, are irrefutable that high cost, front-end load funds can never, as a group, match funds that use his proven strategies. There are always exceptions, but you think you are smart enough to pick those funds in advance?? I wish I knew about Peter Lynch before he started doing all those wonderful things, but unfortunate-ly, like most other people, I couldn't pick him out of the bunch 20 years ago. Index funds give you a shot of at least matching the market, which as they say, ain't bad the last few years.

Rating:
Summary: Clear, concise, and correct advice on Investing
Review: Bogle is the best at giving people the straight dope on what to do in simple investing. If you are not a whiz on the market or investing, no matter, he gives his main message clear enough; even though you will notice he doesn't dumb it down for the uneducated. Even if you think you understand the market to a large degree, make sure to read it too, for you will learn a thing or two. You won't get this valuable message any other place. You can "bank" on his advice.

Rating:
Summary: Bogle clearly states the facts about mutual fund investing.
Review: Bogle makes an impressive case both logically and factually for using low cost and widely diversified mutual funds as one's primary investment vehicle. A key example of such a strategy is indexing both stocks and bonds.

Rating:
Summary: Great ideas, but a bit repetitive
Review: Bogle makes compelling arguments about the advantages of index funds and the importance of the costs/loads and tax consequences of mutual funds. I've become a firm believer in these ideas. However, the book is quite repetitive. In chapter after chapter, he gives examples of how much mutual fund loads or taxes cost you over the long run. I ended up skimming much of the content as I went on. He also had a section of the book about how the mutual fund industry in general which I didn't find very interesting.