Customer Reviews

Due Diligence

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I saw the author give a presentation recently and obtained a copy of his book. Wow! Who knew this whole thing goes back to the Magna Carta (the beginning of the book is rivetting to this ol' history buff). More importantly, the book is exactly what I've been looking for. As a director on a non-profit board, I've often been uncomfortable with the virtual "rubber stamp" the board usually applied to its investment decisions. Granted, our endowment is modest, but now I have an easy-to-read, easy-to-understand step-by-step process to review investments. I even have some sneaky questions. (I can readily picture my broker cringing when I ask them!) This is a great book. It's written in a lively style. I'm going to recommend every member of our board read it.

In my opinion, a must read for every retirement plan trustee and fiduciary. Check it out.

I really liked this book. Here's a rarity - someone with credible experience in the trust and investment business who can actually write! His style is very engaging - I actually laughed out loud at his witty commentary! Only a dry old fogey (or a jealous competitor) would complain about this book. It's a great "How-to" manual for any individual trustee or fiduciary who has to decide on how to invest. What's more, given the age of the book (it was published in 1999), it seems like the author was on the leading edge (or at least one of the very few willing to commit their reputations in writing) to laud behavior finance (remember, BF didn't win a Nobel Prize until several years later in 2002) and expose modern portfolio theory for what it truly is. All in all - it's a quick read that's jam packed with helpful checklists and forms. If I were a bank trust officer, I wouldn't want my clients to know what's in this book for fear of losing my job!

This book is a must read for anyone (including honest professionals) who is responsible for investing other people's money. The author has the perfect credentials to write this books. He was a trust officer, a mutual fund manager and an investment adviser. He knows where to go to uncover the industry's skeletons and he's not afraid to do so. While the entire book is written in a peppy prose that keeps the reader glued to the page, my favorite section was the expose the author calls "the Seven Deadly Sins of Professional Money Managers." Though I have no doubt this section will inspire the wrath of those professionals who commit these sins, I found the section very entertaining and very helpful to those very busy individuals who, as a trustee or fiduciary, may not have the time to dig deep enough when listening to a typical investment sales pitch. In fact, I found the most useful part of the book to be the many forms and checklists provided by the author. These, together with several case studies where the author takes the reader through a variety of real life situation, makes the book hit a home run. If the author can speak half as well as he can write, I'd love to see him give a presentation on this or other related topics.

This book throws out just about all the knowledge that has been accumulated by the professional and academic investment community over the past five decades. The result is an amateurish book. The author Christopher Carosa explicitly rejects assets allocation and states that under no circumstance should an investor buy long-term bonds. With regard to risk management, which he makes light of as one of his Seven Deadly Sins, he states that one should "never consider risk tolerance ahead of the actual lifetime goals and associated investment goals." In his opinion, portfolios should either be short-term (invested in shorter-term bonds) or long-term (invested in all stock). He rehashes his idea repeatedly that an investor should hire a local Registered Investment Adviser or a local mutual fund, both of which his firm Carosa, Stanton & DePaolo Asset Management offers in the western New York area. He tells readers to avoid the workaholic investment adviser and not to work with a firm that uses an investment committee approach. He is very opinionated, repeats himself and does not offer much of substance to a trustee looking to gain an overview of responsibilities and investment guidance.

Depending upon your needs, I'd recommend instead Robert Fry's Nonprofit Investment Policies, Andrew Tobias's The Only Investment Guide You'll Ever Need, or John Train's Investing and Managing Trusts Under the New Prudent Investor Rule.