Comments on: Quotable guide to passive investing (II) http://blog.canadianbusiness.com/quotable-guide-to-passive-investing-ii/ Fri, 19 Mar 2010 22:55:37 -0400 http://wordpress.org/?v=2.8.4 hourly 1 By: frank http://blog.canadianbusiness.com/quotable-guide-to-passive-investing-ii/comment-page-1/#comment-53754 frank Fri, 13 Nov 2009 00:24:36 +0000 http://blog.canadianbusiness.com/?p=4151#comment-53754 do this based on Money Sense Guide! do this based on Money Sense Guide!

]]> By: Mark Wolfinger http://blog.canadianbusiness.com/quotable-guide-to-passive-investing-ii/comment-page-1/#comment-53219 Mark Wolfinger Wed, 11 Nov 2009 14:16:32 +0000 http://blog.canadianbusiness.com/?p=4151#comment-53219 1) “The simplest approach to diversifying your stock market investments is to invest in one index fund that represents the entire stock market.” Simplest? Why would anyone want to finding the simplest? One strives to find the best. Because that is an unreasonable quest, then how about looking for the safest with the highest returns? How about proven track records for more than 20 years? In other words, use options to hedge. 2) “After nearly 50 years in this business, I do not know of anybody who as done it (market timing) successfully and consistently.” Not one single example? The laws of statistics says there must be at last a few. Unless he is referring to doing it for 50 years. That's a bit unrealistic and far exceeds the working lifetime of just about everyone. 3) “The simplest of all approaches is to invest solely in a single balanced market index fund–just one fund. And it works.” Samestory. It 'works'? Not when compared with writing covered calls. Larry, I agree than many investors an use the simplistic advice quoted. But surely some are sophisticated enough to move beyond the industry hype. Mark http://blog.mdwoptions.com 1) “The simplest approach to diversifying your stock market investments is to invest in one index fund that represents the entire stock market.”

Simplest? Why would anyone want to finding the simplest? One strives to find the best. Because that is an unreasonable quest, then how about looking for the safest with the highest returns? How about proven track records for more than 20 years?

In other words, use options to hedge.

2) “After nearly 50 years in this business, I do not know of anybody who as done it (market timing) successfully and consistently.”

Not one single example? The laws of statistics says there must be at last a few. Unless he is referring to doing it for 50 years. That’s a bit unrealistic and far exceeds the working lifetime of just about everyone.

3) “The simplest of all approaches is to invest solely in a single balanced market index fund–just one fund. And it works.”

Samestory. It ‘works’? Not when compared with writing covered calls.

Larry, I agree than many investors an use the simplistic advice quoted. But surely some are sophisticated enough to move beyond the industry hype.

Mark
http://blog.mdwoptions.com

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