Remember “The Action Hero’s Handbook?” You could learn how to catch a Great White Shark, deliver a Vulcan Nerve Pinch, or fix a broken Space Shuttle during re-entry.
There are a couple of how-to’s in that book that remind me of investing. One is How to Predict the Future and the other is How to Perform the Jedi Mind Trick. Both are valuable skills if you are in the Stock Picking or Market Timing game. Brokers might be able to convince folks that picking stocks and timing the market are skills they possess.
Unfortunately for those brokers, the evidence to the contrary is massive while any evidence used to espouse the benefits of active management is anecdotal and thin at best. There is another book I would like to mention. “Think, Act and Invest LIke Warren Buffett” by Larry Swedroe. I have mentioned Larry in prior posts. He is a prolific financial author and partner in The BAM Alliance – a group of firms including ours that subscribe to Modern Portfolio and Passive Asset Class Investing.
I will share this book with the first 25 people who request it via this blog site. Next week I will have more on the idea of Asset Classes vs. Indices so stay tuned!