It’s no secret that I think individual stocks have no place in most investors’ portfolios. I think most investors are far better served by a simple portfolio of low-cost index funds or ETFs.
That’s why I was intrigued to hear from Kathy Kristof (Contributing Editor at Kiplinger’s Personal Finance, a self-described “moderately lethargic investor,” and somebody who is perfectly well informed about the benefits of index funds) about an experiment she’s trying with her own money. She’s taking $200,000 of her own retirement portfolio, putting part of it into Vanguard’s Total Stock Market ETF and the rest into a portfolio of individual stocks that she’s put together.
She’s reporting her results in an ongoing column: Our Practical Investor’s Portfolio.
I wish her a successful combination of luck and/or skill.
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February 3, 2012 3 comments
As you might have guessed based on the fact that I don’t make video posts, I learn better by reading about a topic than I do by watching a video. Of course, many people’s preferences are just the opposite.
That’s why I’ve been meaning to mention a series of videos made by Boglehead forum member Rick Van Ness (username “stickman” on the forum). The videos provide 10 rules (one video for each rule — most of them just under 5 minutes) that can help new investors get started on the right path.
You can see the videos here.
There’s also an accompanying book, which I just got the chance to read this last week: Common Sense Investing: Ten Simple Rules to Finance Your Dreams. Like the books I write, this book is brief and to the point. And the advice is solid and easy to understand.
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January 27, 2012 5 comments
The one aspect of investing that I hear more and more about every year is ETFs. More investors are using them. More fund companies are offering them. And more writers are writing about them. This week I particularly enjoyed two such articles:
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January 20, 2012 0 comments
One investing topic that comes up frequently in reader emails is whether or not it makes sense to adjust your asset allocation based on current market valuations. I think reasonable arguments can be made on both sides of the matter, though I personally find the arguments against doing so to be more convincing.
This week I enjoyed a column from Matthew Amster-Burton that addressed both sides of the discussion: Timing the Market Using Stock Valuations
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January 13, 2012 2 comments
With enough people making market predictions, it’s a given that some of them will turn out to be right. Some will be so accurate as to give the impression that the person who made the prediction is nothing short of a genius.
Every year, members of the Bogleheads Forum get together to prove this phenomenon by guessing where the S&P 500 index will close at the end of the year. For 2011, two Bogleheads guessed within four cents of the correct ending value. These people should be running hedge funds, right? 
If you want to join the fun and have a chance at winning two excellent books, you can make your prediction for the 2012 contest here.
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January 6, 2012 0 comments
As of this last week, I’m officially a Missouri Licensed CPA. The licensing process took me somewhat longer than normal (just over 3 months since learning I passed my final exam) because we lived in Illinois when I started taking the exam, so I was an Illinois CPA candidate — which meant I had to become an Illinois CPA first, then apply to become a Missouri CPA via reciprocity.
The only change you should notice around here is that, in order to comply with the requirements of Treasury Department Circular 230, my blog posts (and tax-related emails) will now contain a lovely disclosure at the bottom, essentially stating that you can’t use any tax advice contained here on the blog to cheat on your taxes.
In any case, thanks to everybody who cheered me along through the process, and Happy New Year to all of you. 
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December 30, 2011 20 comments
