Investment Mistakes Even Smart Investors Make and How to Avoid Them [Hardcover]

Larry Swedroe (Author), RC Balaban (Author)

Book Description

Publication Date: November 17, 2011

EVERYONE MAKES MISTAKES. THIS BOOK SHOWS YOU HOW TO MAKE MONEY.

“Swedroe and Balaban show you how to avoid being your own worst enemy and how to win the investment game by not losing.”
—Burton G. Malkiel, author of A Random Walk Down Wall Street

“Sure, we’ve all made mistakes, and they can be pretty expensive, even the first time. This wonderful volume will pay for itself a thousand times over.”
—William Bernstein, author of A Splendid Exchange and The Investor’s Manifesto

“In his new book, Larry Swedroe—America’s preeminent writer on passive investing—shows you how to recognize your mistakes and, more importantly, how to avoid future mistakes to secure a worry-free financial future. This book will prove to be a classic blueprint on sidestepping the blunders made by even the smartest of investors.”
—Bill Schultheis, author of The New Coffeehouse Investor

“This is a book that does not belong on your bookshelf; it belongs in your hands. Buy it, read it (and it’s fun reading), and prosper.”
—Harold Evensky, President, Evensky & Katz Wealth Management

“Swedroe’s tour through the world of money and psychology is a trip every investor should take.”
—Gary Belsky, coauthor, Why Smart People Make Big Money Mistakes...And How to Correct Them

With a Foreword by Meir Statman, author of award-winning What Investors Really Want

Even the most experienced investors in the world can screw up—and don’t let anyone tell you otherwise. Whether you’re an old pro with a well-designed portfolio or a newbie investor just starting out, bestselling author Larry Swedroe with RC Balaban can show you how to “live and learn” from others’ mistakes—and invest in good times and bad.

By answering the key questions every investor should ask, you’ll learn how to avoid:

Mistake #1: Feeling too confident in your investing skills
Mistake #6: Allowing yourself to be swayed by popular opinion
Mistake #11: Holding on to assets because of the price you paid
Mistake #15: Letting friendships influence your choice of advisors
Mistake #31: Expecting miracles from hedge fund managers
Mistake #48: Confusing speculation with investing
Mistake #60: Underestimating the number of stocks you need to diversify
Mistake #71: Forgetting that you can be too conservative
Mistake #77: Repeating the same mistake

Be warned: This groundbreaking guide will shatter the myths about money you’ve come to accept and challenge the conventional wisdom you’ve received from friends, advisors, and other “experts.”

By exposing these all-too-common mistakes, one by one, you’ll be able to rethink your strategy and reinvest in your future with confidence. You’ll discover the truth about misleading demographics, “high-return” investments, active managers, and other resources you should—or shouldn’t—trust.

You’ll learn the actual devastating effect taxes can have on your returns if you use the wrong strategy. You’ll learn the wrong way and the right way to build your portfolio, diversify your accounts, and plan for your family’s future. Most important, this book will show you how to avoid making the investment mistakes you used to make and how to give yourself the best chance of achieving your financial goals.

Filled with insider insight, need-to-know advice, and revealing case studies, this is the one book smart investors can learn from—and even smarter investors can invest in.

Editorial Reviews

About the Author

Larry E. Swedroe is the bestselling author of the The Only Guide series and other successful investment guides. He writes the blog “Wise Investing” for CBS MoneyWatch.com and speaks frequently at financial conferences. He is also a principal and Director of Research for The Buckingham Family of Financial Services, which includes Buckingham Asset Management and BAM Advisor Services. In addition, he has held executive-level positions at Prudential Home Mortgage, Citicorp, and CBS.
RC Balaban is a former journalist and currently the media specialist for The Buckingham Family of Financial Services, which includes Buckingham Asset

Product Details

• Hardcover: 224 pages
• Publisher: McGraw-Hill; 1 edition (November 17, 2011)
• Language: English
• ISBN-10: 0071786821
• ISBN-13: 978-0071786829
• Product Dimensions: 6.5 x 1 x 9.3 inches
• Shipping Weight: 1.2 pounds (View shipping rates and policies)
• Average Customer Review: 4.8 out of 5 stars  See all reviews (11 customer reviews)
• Amazon Best Sellers Rank: #181,783 in Books (See Top 100 in Books)

Most Helpful Customer Reviews

14 of 15 people found the following review helpful

5.0 out of 5 stars What Every Investor Needs To Know December 1, 2011

By Andrew Hallam

Format:Hardcover

This book is filled with evidence-based investment advice that every investor should know, but none of us are taught. There are so many things that investors take for granted, but that blind faith is costly.

If you think you can gain advice from listening to a talking head on television, for example, you can do two things:

1. Read this book, which will convince you otherwise (cheaply)

Or

2. Take the advice of the experts on television, and learn the same thing--eventually--at the expense of your future nest egg. Analysts and economic forecasters prove, time and time again, that they aren't worth their weight in sand.

I especially like the warnings given to those who think they can buy individual stocks, and do well. Many people think that all you need to do is buy great companies. But this book articulates, clearly, what so many academics have known for years. The best performing stocks tend to be those that nobody has the guts to buy. And if that tempts you to buy garbage stocks in hope of great rewards, you might want to think twice. There's no easy way to beat the market. Trying to do so (and learning from your mistakes) won't be a cheap education. It will be an expensive one.

I wish every parent and grandparent could read just two pages of this book, each day, to the children in their lives. It's a teaching tool that would benefit the next generation.

9 of 9 people found the following review helpful

5.0 out of 5 stars Every good investment book you've ever read -- combined December 28, 2011

By Wendy Cook

Format:Hardcover

I've been reading Larry's (and his co-authors') books since his first, ironically named "Only Guide" was initially published back in 1998. More than a dozen years later, and Larry's advice has scarcely changed, which only goes to show how good it was -- and is -- to begin with. Had I not been following his advice all these years, I shudder to think of the damage I would have done to myself through the Tech bubble bust, 9/11, the Great Recession, the European crises, and everything in between. At least for me, his words of wisdom have stood the test of time.

But even if you've read everything Larry and friends have written to date, you'll be cheating yourself if you don't add his latest to your library -- and as a gift to your friends' and family members' libraries, while you're at it. If you've been investing so poorly that you can only afford one book on how to restore sanity to your investment activities, this may well be "the one." Larry and RC have taken the best of: (1) our own worst behaviors, (2) the biggest Wall Street hurdles standing in our way, and (3) the biggest mistakes made in understanding and implementing the tenets of sensible investing. They've stuck them in one, tidy little volume. They've slapped an affordable price tag on it, especially if you consider the wealth you'll save from the learning. What's not to love about "Investment Mistakes Even Smart People Make"?

5 of 5 people found the following review helpful

5.0 out of 5 stars I bought the eBook and it is a gem March 26, 2012

By SNOOKIE

Format:Hardcover|Amazon Verified Purchase

Larry Swedroe and R C Balaban have written a little book that enumerates some 77 mistakes that the average investor makes. The book can be read in any order and each mistake is carefully explained to the reader. I have all of Larry's prior books and they are a big help in my investing program.
This new eBook is another gem. It contains the do's and do not's gleaned from his other books,carefully organized, a valuable guide for the average investor. When I finished reading the book I thought here is a first aid kit for the investor frightened when the stock market crashes. Larry has cleverly used some of the interesting features of eBooks. For example in the index find the term and then with one click your are taken to the exact place where the word or term is explained in detail. And with one click returned to the exact place you were when you left the text. This feature saves lots of time and makes reading comfortable easy.Use that little arrow in the upper left hand corner of your screen to use this feature.

The glossary and index are helpful to the new investor who may not be able to understand the technical terms used by many writers of financial books. You will find that you will be using this book many times after you first read the volume. and using these features long after you have finished this eBook and reading other financial books.

One thing about any of Larry's books is that each point is carefully and clearly explained. You never have the feeling what was he talking about.I buy all my books on investing from Amazon and my book cases are full of them. Any book that does not fit your requirements can be returned , no questions asked postage paid. Once I purchased a school book for my grandson and he called me to explain that the professor had changed the book for the class. College text books are extremely expensive and Amazon arranged that he returned the book and my purchase price was promptly credited to my account without questionj.