Bernstein W.J. The Four Pillars of Investing: Lessons for Building a Winning Portfolio

McGraw-Hill – 2010, 350 p.
ISBN: 9780071759175The classic guide toconstructing a solid portfolio — with out a financial advisor! With relatively little effort, youcan design and assemble aninvestment portfolio that, becauseof its wide diversification and minimalexpenses, will prove superior to themost professionally managed accounts.Great intelligence and good luckare not required. William Bernstein‘s commonsense approachto portfolio construction has served investorswell during the past turbulent decade — andit‘s what made The Four Pillars of Investing aninstant classic when it was first published nearlya decade ago. This down-to-earth book lays out in easy-to-understandprose the four essential topics thatevery investor must master: the relationship ofrisk and reward, the history of the market, thepsychology of the investor and the market, andthe folly of taking financial advice from investmentsalespeople. Bernstein pulls back the curtainto reveal what really goes on in today‘s financialindustry as he outlines a simple program forbuilding wealth while controlling risk.Straightforward in its presentation and generous inits real-life examples, The Four Pillars of Investingpresents a no-nonsense discussion of: The art and science of mixingdifferent asset classes into aneffective blend The dangers of actively pickingstocks, as opposed to investingin the whole market Behavioral finance and howstate of mind can adverselyaffect decision making Reasons the mutual fund andbrokerage industries, rather thanyour partners, are often yourmost direct competitors Strategies for managing all of yourassets — savings, 401(k)s, homeequity — as one portfolio Investing is not a destination. It is a journey, andalong the way are stockbrokers, journalists, andmutual fund companies whose interests are diametricallyopposed to yours. More relevant today than ever, The Four Pillars ofInvesting shows you how to determine your ownfinancial direction and assemble an investmentprogram with the sole goal of building long-termwealth for you and your family.
Since its initial publication, The Four Pillars of Investing has become a staple for the independent-minded investor looking to make better-informed investment decisions. Written by noted financial expert and neurologist William Bernstein, this time-honored investing guide provides the knowledge and tools for achieving long-term profitability.
Bernstein bridges the four fundamental topics successful investors use to generate exceptional profits on a consistent basis:
The Theory of Investing: Do not expect high returns without risks.
The History of Investing: About once every generation, the markets go barking mad. If you are unprepared, you are sure to fail.
The Psychology of Investing: Identify the era’s conventional wisdom and assume that it is wrong. More often than not, it is.
The Business of Investing: The stockbroker services his clients in the same way that Bonnie and Clyde serviced banks.From the essential soundness of classic portfolio theory through the inherent wisdom of investing in multiple asset classes, The Four Pillars of Investing provides a distinctive blend of market history, investing theory, and behavioral finance to help you become a successful, self-sufficient investor.PrefaceiPillar One: The Theory of Investing
No Guts, No Glory
Measuring the Beast
The Market Is Smarter Than You Are
The Perfect Portfolio
Pillar Two: The History of Investing
Tops: A History of Manias
Bottoms: The Agony and the Opportunity
Pillar Three: The Psychology of Investing
Misbehavior
Behavioral Therapy
Pillar Four: The Business of Investing
Your Broker Is Not Your Buddy
Neither Is Your Mutual Fund
Oliver Stone Meets Wall Street
Investment Strategy: Assembling the Four Pillars
Will You Have Enough?
Defining Your Mix
Getting Started, Keeping It Going
A Final Word2010 Postscript