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Higher Returns from Safe Investments: Using Bonds, Stocks, and Options to Generate Lifetime Income Hardcover – March 15, 2010
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From the Back Cover
- Safer strategies for boosting fixed income returns
"Smarter ways to mix bond ladders, investment-grade taxable bonds, municipal bonds, and high-yield bond mutual funds"
- Stock strategies that create new income streams at lower risk
"Simple ways to use high-dividend stocks and covered call writing"
- Building the right income portfolio for your situation
"Practical choices that reflect your temperament, goals, and needs"
Top Customer Reviews
Some of his advice may seem questionable, in that it differs from what it written in many other sources, and there's not enough information to help weigh the merits. For example, he recommends that a portion of even conservative portfolios be allocated to stocks (a common idea), but suggests a surprising weighting in emerging market stocks (commonly viewed as highly volatile). On the other hand, he doesn't even mention non-U.S. bonds (often viewed as a desirable component of a bond portfolio). My point isn't to judge the merits of any of this advice (I'm no pro), but simply to observe that this book won't help in evaluating any of it.
Longer term fixed rate investments may keep up with current inflation rates, but could be fast money losers if interest rates rise, which is likely since it would be hard for them to go much lower. So what is a poor investor in 2011 to do? I think reading this book is a good start. The author reviews strategies that are specifically suited to investors tired of losing money in stocks who are seeking higher, safer income after the market woes of 2008 - 2010. The author's specific suggestions include the pros and cons of investments such as individual TIPS bonds, TIPS funds, high yield bond funds, municipal bonds, bond ladders and more in a low interest rate, yet average inflation rate environment.
This book takes a view of income investing that is correct for average credit markets, for the most part. But average credit markets rarely exist. Few investors possess the fortitude to go through the nadir of the credit cycle, and ride it into the next cycle.
With high yield, he offers a simple stop-loss strategy. Good. But he should offer something similar on preferred stocks and dividend-paying common stocks, which are riskier than high yield bonds.
The chapter on writing covered calls is simplistic, but the truth is that most of us are simplistic with covered calls -- we look for free yield, and often gain losses greater than the income received.
The book gives simple and reasonable descriptions of various bond types, and other income oriented assets. In general, it understands the relative riskiness of all of them, with exceptions noted above.
The title is a great title, but I would have loved to have seen a different book that would have taught people to analyze yield spreads, and getting people to think when there is enough compensation for the risk involved, and when there is not.
Who would benefit from this book
If you don't understand income investments, this book could be useful to you, and the book is not long. It is an easy read. In general I don't agree with the way the book is designed, but if you have a lot of self-discipline, the book will prove useful to you.
NOT JUST ABOUT BONDS
The book is filled with examples and introductions to all areas of income generating investments, from regular bonds, bond ETF's to mutual funds. It touches upon preferred stocks as well.
I think this is a fantastic handbook for the conservative investor and for those that are learning how to diversify their portfolio. Dr. Appel shares some of his investment picks with the reader and explains with clarity the reasons behind his choices.
BE WARY OF HIDDEN FEES AND TAXES
I found Dr. Appel's explanation of the different types of fund shares and hidden sales fees, and commission fees to be quite interesting. He also talks about the effect that Taxes have on certain investments. I always thought that TIPS is a safer way to ride inflation, but I'll think twice now about placing it in a taxable account.
It was an easy read and it really gave some good insights and strategies on investing with income in mind. I'm looking forward to picking up his book on ETF's as well. I found his writing style to be quite understandable. Definitely pick this up to get a good handle on "Safer" Investments.
Most Recent Customer Reviews
Dr. Marvin Appel (Son of market legend Gerald Appel) has done an excellent job with this book showing readers where to find yield in this low yielding investment climate we are in... Read morePublished on August 15, 2010 by Steve Burns