Rating: 
Summary: Essential reading
Review: Everything that can be said has already been said in the last few reviews, so I will make this short. What Bill covers should take care of the average investor over a lifetime of investing, coupled with his first book. Not only does his advice make sense, but it is great reading too! Invest in this book, it will be far more profitable than your last stock trade.
Rating: 
Summary: Can efficient markets go barking mad?
Review: Four Pillars is one of the best of the 15 investing books I have read. It is noteworthy because the book: * integrates numerous theories of investing (Indexing, Efficient Market, Portfolio theory).
* places returns of various asset classes (large/small/growth/value stocks, bonds, REITs, minerals, cash) into historical perspective, then lays out a clear argument why the future may not resemble the past.
* provides extensive evidence why investors should steer clear of brokerages, mutual funds, and the cheerleading financial news industries.
* Bernstein has a colorful command of the language. It would be no problem to give more details of why this book is outstanding, and I think other reviewers have done just that. I will instead explain why I rated this book four and not five stars: * Bernstein is an Efficient Markets proponent, claiming that the markets are wiser than any individual investor or money manager. He concludes there is no room for stock picking. On the other hand, he observes, in his own inimitable style, "once a generation the markets go barking mad". Well, which is it? If the markets are efficient, then they will never go barking mad. And if they occasionally go barking mad, then they aren't always efficient.
* Bernstein claims that it is a fool's game to try to beat the markets (seeing as how they are efficient). He then proceeds to claim that Portfolio Management can consistently and over the long run beat the markets (albeit by less than 1%). Perhaps he should have added a caveat to his statements rather than create the appearance of internal contradiction.
* Bernstein makes extensive use of statistics to prove that, on average, the average investor cannot do better than the market average. He then goes on to prove that it is highly unusual for investors to have returns that are statistically unlikely. While this is simply a tautology, it is presented as a great insight into the market. For that matter, the odds that you have a college degree and have 5 close friends with college degrees is about 1 in 100. Yet I would wager that most people reading this review fit that category. Bernstein's observations are technically correct, but are a good example of Mark Twain's statement "there are lies, damned lies, and statistics". I raise these points not to quibble over the validity of this or that idea in this excellent book, but rather to highlight that this book includes a healthy mixture of investing theory and astute observations, and given the complexity of the market, they do not always fit perfectly. I have only one complaint. Bernstein waits till nearly the end to state that he is only referring to long term investing for retirement. Personally, I like to play the market with money I can afford to lose, and I generally "swing for the fences". Four Pillars is downright derisive towards this type activity. This caused me cosmic dissonance until I divined this unstated assumption.
Rating:
Summary: Very Good Overview of Investing Principles and Applications
Review: I am an avid fan of Bernstein and his fellow travelers in the Efficient Frontier, Sharpe, and other innovations of Modern Portfolio Theory, so I was disappointed to see so little of this valuable information included in this book. I understand that this book was meant to be less intimidating to the novice and intermdiate investor alike, and he doesn't disappoint with accessible articulation and a witty style that should appeal to every reader. The two chapters on asset allocation, the ~one~ thing the investor is able to control, and the one thing which directly rewards the investor, doesn't explain the "frontiers" and why four assets or ten is best for the individual investor. The efficient frontier in layman's terms would have been especially helpful. On the other hand, dauntless pages were dedicated to diminishing returns (DR), which were clearly adumbrated for their importance. Then Bernstein concentrates on Vanguard investment opportunities, with only brief reference to ETFs (exchange traded funds). Vanguard is to be commended for bringing index-investing to the fore, but Vanguard's steep minimums and stiff penalties are impediments for the smaller investor and are downright subversive to the investor who does not believe in a "buy-and-hold" theory of investing. Many ETFs are more asset specific and can be had without excess cost through a discount broker. I wish Bernstein had discussed the merits and demerits of "buy-and-hold" as opposed to, say the Fabian and other methods of entering and exiting the market on certain MDAs (moving daily averages). I found Bernstein's lack of mention of mid cap stocks throughout the book puzzling. None of the hypothetical asset allocations in the book have any room for mid caps, which can enhance performance and reduce risk. For Bernstein, there are only large and small market capitalization - no middle capitalization. Also, foreign funds and ETFs of foreign assets (such as EFA for MSCI-EAFE index) are considered important, but get only passing and ambiguous comments. The graphs and tables are helpful for the most part, but many are out of date, and some lacked a marked differentiation in plotting more than one overlap, which made for challenging deciphering. The writing is effusive and accessible, making it a good introductory book and a refresher for bulls and bears alike. Overall, I found the book to be a tad bit too garrulous, but easy to read and informative . My cavils and criticisms aside, this book is truly one of the best books on investment in print.
Rating:
Summary: The Best Investing Book I've Read
Review: I began seriously investing in stocks and bonds about three years ago. Since that time, I've read perhaps a dozen books on investing. This is my favorite. It has all the elements a beginning investor needs: clear explanations of basic investing concepts; lucid and entertaining prose; a brief history of the market to illustrate for the reader both the manias and extreme pessimism that have sometimes gripped it; and, most importantly, numerous cautionary tales about the industry that helps beginners make their investment choices. Bernstein identifies four pillars for building a portfolio: theory, history, psychology and the business. The pillar of theory is about the conceptual framework of investing. This potentially could have been a very difficult section, but Bernstein makes it very readable even though he introduces a couple of ideas he claims most brokers are not familiar with. The second pillar of history is about how markets in the West have behaved in the past. Bernstein argues this history is important to remember so that investors develop reasonable expectations for what their investment will do and recognize both the warning signs of an overheated market or the symptoms of a depressed one. The third pillar of psychology helps the reader to combat the usual mistakes beginning investors make: excessive trading, following hot stocks and funds, high fees, overconfidence, etc. Bernstein says the investor must learn to emotionally detach him- or herself from the investing crowd while still keeping a healthy respect for all he doesn't know. The fourth pillar of business emphasizes that those who provide investment services for you are often your worst enemy to getting a decent return on your money This is a great book, but not a perfect one. I wish Bernstein had explained some things more fully - especially in the first section of the book on theory. But what he does explain, he explains well enough to catapult the reader to the next level of understanding, should he or she choose to go there. Some critics of the book might argue that Bernstein says nothing new. This is true. But the effectiveness of the book is in the way it is presented and how it is written. I recently read John Bogle's book "Common Sense on Mutual Funds". It is a superb book, and has many (but not all) of the same points as "The Four Pillars of Investing". But it fails to engage the reader as well as this book does.
Rating:
Summary: The Best Investing Book I've Read
Review: I began seriously investing in stocks and bonds about three years ago. Since that time, I've read perhaps a dozen books on investing. This is my favorite. It has all the elements a beginning investor needs: clear explanations of basic investing concepts; lucid and entertaining prose; a brief history of the market to illustrate for the reader both the manias and extreme pessimism that have sometimes gripped it; and, most importantly, numerous cautionary tales about the industry that helps beginners make their investment choices. Bernstein identifies four pillars for building a portfolio: theory, history, psychology and the business. The pillar of theory is about the conceptual framework of investing. This potentially could have been a very difficult section, but Bernstein makes it very readable even though he introduces a couple of ideas he claims most brokers are not familiar with. The second pillar of history is about how markets in the West have behaved in the past. Bernstein argues this history is important to remember so that investors develop reasonable expectations for what their investment will do and recognize both the warning signs of an overheated market or the symptoms of a depressed one. The third pillar of psychology helps the reader to combat the usual mistakes beginning investors make: excessive trading, following hot stocks and funds, high fees, overconfidence, etc. Bernstein says the investor must learn to emotionally detach him- or herself from the investing crowd while still keeping a healthy respect for all he doesn't know. The fourth pillar of business emphasizes that those who provide investment services for you are often your worst enemy to getting a decent return on your money This is a great book, but not a perfect one. I wish Bernstein had explained some things more fully - especially in the first section of the book on theory. But what he does explain, he explains well enough to catapult the reader to the next level of understanding, should he or she choose to go there. Some critics of the book might argue that Bernstein says nothing new. This is true. But the effectiveness of the book is in the way it is presented and how it is written. I recently read John Bogle's book "Common Sense on Mutual Funds". It is a superb book, and has many (but not all) of the same points as "The Four Pillars of Investing". But it fails to engage the reader as well as this book does.
Rating:
Summary: Telling it like it really is
Review: I enjoyed this book by William Berstein. The fact that John Bogle selected The Four Pillars of Investing: Lessons for Building A Winning Portfolio as the best investment book for 2002, I unhesitantly went out, bough it and absorbed it. Some of the key points are: The Art and Science of mixing different asset classes into an effective blend. The dangers of actively picking stocks, as opposed to investing in the whole market. Behavorial finance and how state of mind can adversely affect decision making. Why the mutual fund and brokerage industries instead of being your partners, are often your most direct competitors. Strategies for managing all of your assets---savings, 401 (k)s,
home equity --- as one portfolio. William Bernstein says it best; "The overarching message of this book is at once powerful and simple: With relatively little effort, you can design and assemble an investment portfolio that, because of it's wide diversification and minimal expence, will proove superior to most professionally m managed accounts. Great intelligence and good luck are not required. The essential characteristics of the succcessful investor are the discipline and stamina...stay the course." Investing is a journey not a destination lined with stockbrokers, journalists, and mutual fund companies whose interests are diametrically opposed to yours. The Four Pillars of Investing shows you how to ignore distractions, stay the course, and determine your own financial direction with the sole goal of building long-term wealth for yourself and your family. The Four Pillars of Investing provides an easy, step by step program for achieving long-term investing success. Highly recommended.
Rating:
Summary: Bernstein's 4 pillars
Review: I have been an avid investor for over 30 years and am widely read in this area. If i were to recommend one book on personal investing, this would be it. Dr. Bernstein builds nicely upon the work of masters such as fisher, dreman, malkiel, graham, and others. He shows that investing can be very simple if one keeps an eye on the big picture and the long-term. His obvious intent in writing this book is to help individuals design an investment strategy to fulfill their long-term financial goals. There is some financial math and charting in the book which may be challenging to the uninitiated, but even if these aspects are above your head, his writing style is very accessible and personal, so the basic message comes through loud and clear.
Rating:
Summary: A Thinking Investor's Book
Review: I have looked at a number of different investing strategies over the years and I really have to say that I enjoyed reading this guide to investing. Bernstein very carefully and methodically critiques the state of the investment industry and provides you with the correct ways to invest and interpret market news. There is some confirmation here with some successful trading techniques I have read about, one technique asks you to totally screen out media influence, another recommends fading news. If there is one great kernel of truth that I believe and read over and over again in good books on investing, it is to develop your own set of unbiased indicators to base your investment decisions upon. Another good book that keys off of real, unbiased data for developing a sound investment methodology is the 401k MarketBuster, which gives you a Fed following system that tests out pretty well. In any case, you can't go wrong with either book.
Rating:
Summary: a pleasure
Review: i have read many financial books but this book is the first one which i found entrancing. it is great entertainment and the case he makes for his positions in personal investing is very persuasive. he caused me to make some financial moves which is, i think, the best argument for the book's value to me.
dan mccaw
Rating:
Summary: The truth hurts
Review: I never thought I would say that I had a hard time putting down a book on finance, but I am mesmerized by this one. First, this book clearly states a lot of cold, hard truths about the market that the average person may have a hard time believing, but I can tell you that the author echoes just about everything that my professor taught about the market in my graduate finance class. I didn't believe him then, but after going through a couple of market ups and downs, I sure do now! Second, it explains a lot of tough concepts in a humourous and clear manner. Warning: this book is highly critical of the financial industry and those who work in it, so don't ask your stockbroker what he thinks about it! The best part is that I think he blows away a lot of misconceptions about the market while offering a reasonable investment program for the average guy. No miracles, no get-rich-quick schemes, but a sound, statistically supported method to invest and grow at least at the same rate as the market. Yeah!
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