Investing advice: Fire Your Investment Adviser

From my on-going study on investing, from Malkiel’s  The Random Walk Guide on Investing. For more, see the index page to my full summary.

Basic Point One – Fire Your Investment Adviser

In this chapter he argues that we can do better without investment advisers. These advisers are making money at our expense. They are generally compensated by earning commissions on products they sell us. They make investing seem very complicated so we have to turn to them for advice.  But their products do not return the promised results of beating the market. [As he shows later, 85% of the money managers are beat by the market].

We will see later that the correct investment strategy is actually to throw a tower over the stock page and buy a lost-cost mutual fund that includes all the stocks and does not trade.

Following the advice of these financial “experts” can be hazardous to our wealth.

2000 Forbes article, “…your average pro on Wall Street has failed to beat the indexes.

”The way to get rich from investment advice is to sell it.”

“By keeping your savings and investment strategy as simple as possible, you will free up time to do the really important things you want to do with your life such as spending more time with friends and family.”

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