The Little Book of Safe Money PDF (How to Conquer Killer Markets, Con Artists, and Yourself) acts as a guide for those trying to make their way through today’s down markets. The topics covered include everything from investing behavior-why our minds come with their own set of biases that often prove harmful-to the use of financial advisors. But this timely book goes one step further than the rest by questioning an investor’s true appetite for risk.
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Category: Personal finance
Author: JASON ZWEIG
Free download link: At the end of the post
One of today’s most influential financial commentators offers his advice on keeping your money safe in an uncertain world
The Little Book of Safe Money acts as a guide for those trying to make their way through today’s down markets. The topics covered include everything from investing behavior-why our minds come with their own set of biases that often prove harmful-to the use of financial advisors. But this timely book goes one step further than the rest by questioning an investor’s true appetite for risk.
The Little Book of Safe Money also contradicts many of the myths that whirl around Wall Street with chapters like “Why Ultra-ETFs Are Mega-Dangerous” and “Hedge-Fund Hooey.” Writing in the classic Little Book style, author Jason Zweig peels away layer after layer of buzz words, emotion, and myths to reveal what’s really going on in today’s financial markets.
- Outlines strategies for satisfying our ever-changing investment appetites while focusing on a long-term financial plan
- Author Jason Zweig is a trusted voice in the financial community and his straightforward style resonates with investors
- Offers practical guidance, tools, and tips for surviving and thriving in a down market
If you’re serious about succeeding in today’s turbulent markets, then The Little Book of Safe Money is what you should be reading.
JASON ZWEIG, simply put, is the reigning gold medalist in the investing Olympics decathlon. Allow me to explain. Investing success does not accrue to those with savant-like expertise in one field of intellectual endeavor, but rather rests on four pillars: a command of financial theory, a working knowledge of financial history, an awareness of financial psychology, and a solid understanding of how the financial industry operates. Like the decathlon winner, the successful investor is rarely the world champion in a single event, but rather someone who excels at all.
Few can match Jason’s grasp of investment theory, and I am hard-pressed to name anyone who exceeds his knowledge of investment history or the cognitive neuropsychological aspects of finance. Extol the virtues of Ben Graham’s magisterial Security Analysis, and Jason will ask which edition you’ re referring to. Mention to him the gambling proclivities of medicated Parkinson’s disease sufferers, and then this neurologist soon finds himself humbled by an informed précis of the latest paper on the topic from Archives of Neurology.
Finally, over a professional lifetime as a beat reporter at Forbes, Money, and the Wall Street Journal, Jason has gotten to know the industry as well as anyone: who’s been naughty, who’s been nice, and who will soon be getting unwanted judicial attention in the Southern District of Manhattan. His output in this area has been so prodigious that he hasn’t had the time to submit much of his best work for publication. Few investment professionals, for example, are unaware of his classification scheme that cleaves the mutual fund world into a tiny minority of investment companies, which focus exclusively on their fiduciary responsibility to their customers, and the overwhelming mass of marketing companies, concerned only with their bottom lines. Although Jason has of late made this piece available on his web site,* you will not find it immortalized anywhere between hard or soft covers.
Jason thus has a great deal to offer all investors, from the rankest amateur to the most grizzled pro. Let’s sample just a few of his pearls from each of the four events in the investing Olympics: The theory of investing. Diversification and liquidity are dandy, but they both vanish when we need them the most. As 2008 began, millions of investors owned short-term bond funds holding securities ranging in safety from plain-vanilla high-grade corporate debt to more exotic asset-backed vehicles; a small but soon-to- be – highly -visible minority of funds actually juiced their returns by writing credit default swaps. In normal times, these securities were highly liquid, that is, easily exchangeable for cold, hard cash. When push came to shove in the fall of that year, however, shareholders in need of cash suddenly found that they were worth less than they ever thought possible—in some cases, a lot less. Similarly, during the great bull market of 2002–2007, investors piled into mutual funds specializing in emerging markets and real estate investment trusts (REITs) ostensibly because of their diversification value,but in reality because their recent performance had been red-hot. In the ensuing market collapse, the diversification value of these two asset classes disappeared faster than taco chips at a Super Bowl party, falling, in some cases, 60 to 70 percent. (In truth, REITs and emerging markets stocks do offer substantial diversification benefit, but only if held for the long term: during the 10-year period from 1999 to 2008, these two asset classes provided investors with salutary returns, while the S&P 500 lost money.)
The history of investing. The stock market is not as agreeable a place as many would have you believe. Forget the “stocks for the long run” bias inherent in both the pre- and post-1926 databases used by almost all academics and practitioners. Jason demolishes this paradigm with an efficiency rarely seen this side of a Chuck Norris film: Stock markets do not become less risky with time, do not always return more than bonds, and do vanish, with alarming regularity, into the mists of history.
The psychology of investing. Your own worst enemy is the image in the mirror; this goes double if you’ re a guy. As I read Jason’s sections on the investing heart of darkness inside all of us, I trembled that they might fall into the wrong hands: a snappy ticker symbol, for example, is worth a severalpercent stock price premium. Of course, when it comes to manic-depressive behavior, few can hold a candle to Mr. Market himself, and the sooner you stop becoming his anxious codependent and learn to administer to him the tough love he deserves, the wealthier you will be.
The business of investing. Beware of geeks bearing gifts: Most financial innovation serves roughly the same purpose as the pickpocket’s decoy, the innocent -appearing chap who bumps into you or asks you the time while his deft accomplice relieves you of your wallet. In much the same way, over the past decade hedge funds, bond funds with clever options strategies, and structured investment vehicles have considerably lightened investor ’s wallets.
To paraphrase Rabbi Hillel, enough commentary from me. Turn the page and begin to explore investing’s essential truths with one of its best tour guides.
— WILLIAM J. BERNSTEIN
Table of Contents- The Little Book of Safe Money PDF
The Three Commandments 1
Solid, Liquid, or Gas? 5
You Are an Egg 19
Keeping Your Cash from Turning into Trash 31
Guarantees Are Not All They’re
Cracked Up to Be 45
Fixing Your Fixed Income 53
Stocks for the Wrong Run 67
Rules for Stock Investors to Live By 77
Little Things Mean a Lot 89
How to Get Your Kids through
College without Going Broke 99
What Makes Ultra ETFs Mega-Dangerous 107
Hedge Fund Hooey 117
Commodity Claptrap 131
Spicy Food Does Not Equal Hot Returns 141
WACronyms: Why Initials Are So
Often the Beginning of the End 149
Mind Control 167
Financial Planning Fakery 183
Advice on Advice 189
Fraudian Psychology 199
The Terrible Tale of the Missing $10 Trillion 211
How to Talk Back to Market Baloney 219
“A little book with big advice. Jason Zweig . . . doesn’t promise investors the moon, but in language that everyone can understand, he offers solid, common-sense steps to protect and improve their portfolios. . . Such advice is consistent with the bigidea of Zweig’s book: If an investment looks too good to be true, it probably is. And he offers a useful process to help readers remember it.”
“There are very few in the financial media whose material I would consider recommended reading. Wall Street Journal columnist Jason Zweig is one of them, and his new book is one you should consider. His latest work adds to his reputation for books that not only provide important insights into the winning investment strategy, but are also good reads. This little book is filled with sage counsel from which even sophisticated investors can benefit. . . His book also provides advice on how to avoid many of the behavioral mistakes investors keep repeating. As William Bernstein, who wrote the forward, put it: ‘Jason Zweig knows your financial demons, where they live, why they’re making your poor, and how you can beat them.”
―Larry Swedroe, CBS MoneyWatch
This book is a well written, fascinating page turner that I read in one sitting with a big bag of microwave popcorn. Yet, I don’t just recommend a book because it was thoroughly enjoyable. The main reason to read this book is that it can put you on the path toward reaching financial freedom. But it’s up to you and whether you’d rather spend your retirement years pursuing your interests, or spend them asking strangers if they’d like their value meal supersized.
―Allan Roth, Founder of Wealth Logic, and author of How A Second Grader Beats Wall Street
About the author
JASON ZWEIG is the investing and personal finance columnist for the Wall Street Journal. Previously, he was a senior writer for Money magazine and a guest columnist for Time magazine and CNN.com. Before joining Money in 1995, Zweig was the mutual funds editor at Forbes. A frequent commentator on television and radio, Zweig is also a popular public speaker who has addressed the American Association of Individual Investors, the Aspen Institute, the CFA Institute, the Morningstar Investment Conference, and university audiences at Harvard, Stanford, and Oxford. He serves on the editorial boards of Financial History magazine and the Journal of Behavioral Finance. Zweig has a BA from Columbia College, where he was awarded a John Jay National Scholarship.