Quest for Alpha (Bloomberg)

ISBN-13: 9780470926543 / Angielski / Twarda / 2011 / 208 str.

Larry E. Swedroe;?Abar;?Abar

Opis

The final word on passive vs. active investing The debate on active investing-stock picking and market timing-versus passive investing-markets are highly efficient and almost impossible to outperform-has raged for decades. Which side is right? In The Quest for Alpha: The Holy Grail of Investing, author Larry E. Swedroe puts an end to the debate, proving once and for all that active investing is likely to prove futile as the associated expenses-costs, fees, and time spent analyzing individual stocks and the overall market-are likely to exceed any benefits gained. The book

• Presents research, data, and quotations that reveal it's extremely difficult to outperform the market
• Explains why investors should focus on asset allocation, fund construction, costs, tax efficiency, and the building of a globally diversified portfolio that minimizes, if not eliminates, the taking of idiosyncratic, uncompensated risks
• Other titles by Swedroe: The Only Guide to Alternative Investments You'll Ever Need and The Only Guide You'll Ever Need for the Right Financial Plan

Investors are on a never-ending search for a money manager who will deliver returns above the appropriate risk-adjusted benchmark, aka the "Holy Grail of Investing." The Quest for Alpha demonstrates that it's a loser's game-while it's possible to win, it's so unlikely that you shouldn't try.

Spis treści

Acknowledgments.

Introduction.

The Holy Grail.

The Quest Begins.

Chapter 1 Mutual Funds: The Evidence.

When You Wish Upon a Morningstar.

Focus Funds.

Active Management of Bond Funds.

Skill Versus Luck.

Who Carea about the Average Fund?

With Active Managers, How Long Is Long Enough? 

Advice from Professional Investors and Academics.

Admissions from Industry Practitioners and the Financial Media.

Chapter 2 Pension Plans: The Evidence.

Counterproductive Activity.

The Value of Consultants.

The Performance of Funds Offered by 401(k) Plans.

Fund Selection Skills.

Please Don′t Do Something, Stand Still.

Advice from Professional Investors.

Admissions from an Industry Practitioner.

Chapter 3 Hedge Funds: The Evidence.

The Problems With Hedge Funds.

Advice From Professional Investors and Academics.

Chapter 4 Private Equity/Venture Capital: The Evidence.

Characteristics of Private Equity Returns.

Bias in the Data.

Advice from a Professional Investor.

Chapter 5 Individual Investors: The Evidence.

Investment Returns Versus Investor Returns.

Advice from Professional Investors and Academics.

Admissions from Industry Practitioners and the Financial Media.

Chapter 6 Behavioral Finance: The Evidence.

There Is Smoke, But No Fire.

The Tyranny of the Efficient Markets.

Further Evidence.

The Failed Quest.

The Value of Behavioral Finance.

Even Smart People Make Mistakes.

Admissions from Industry Practitioners.

Summary.

Chapter 7 Why Persistent Outperformance is Hard to Find.

The Quest for Alpha Is a Game Played on a Different Field.

Successful Active Management Sows the Seeds of Its Own Destruction.

Closet Indexing.

Concentration and the Role of Trading Costs.

The Role of Trading Costs.

Drifting Out of Small Caps.

Encore Performances.

Who Gets the Money to Manage?

The Value of Economic and Market Forecasts.

The Value of Expert Judgment.

We All Want to Believe.

The Value of Security Analysis.

Buy, Sell or Hold.

The Hurdles Are Getting Higher.

Advice from Professional Investors and Academics.

Admissions From Industry Practitioners and Academics.

Chapter 8 The Prudent Investor Rule.

The Prudent Investor Rule.

The American Law Institute.

The Uniform Prudent Investor Act.

Chapter 9 Whose Interests Do They Have at Heart?

Advice From Professional Investors.

Admissions From Industry Practitioners and Academics.

A Triumph of Hope Over Experience.

The Arithmetic of Active Management.

The Math Is Always the Same.

The Costs of Active Investing.

The Cost of Cash.

An Expensive Quest.

Summary.

Chapter 10 How to Play the Winner′s Game.

Indexing Is More Than the S&P 500 Index.

Does Passive Investing Produce Average Returns?

Enough.

Needs Versus Desires.

Pascal′s Wager.

Conclusion.

The Yale Endowment Fund.

The Way to Win Is Not to Play.

The Quest for the Holy Grail.

The Winner′s Game.

Appendix A Rules of Prudent Investing.

Appendix B Doing It Yourself.

Notes.

Sources of Data.

About the Author.

Index.

O autorze

LARRY E. SWEDROE is a principal and the Director of Research for the Buckingham Family of Financial Services, which includes Buckingham Asset Management and BAM Advisor Services. He has also held executive–level positions at Prudential Home Mortgage, Citicorp, and CBS. Swedroe frequently speaks at financial conferences throughout the year and writes the blog "Wise Investing" at CBS MoneyWatch.com.

Blurb

"In a world where many investment books promise sure–fire techniques to earn extraordinary returns, it is refreshing to have Larry Swedroe remind us that there are no such techniques in short, there is no holy grail. This delightful book will help investors win by teaching them how to avoid losing." Burton G. Malkiel, author of A Random Walk Down Wall Street

"Larry has written an extremely readable book that you will find hard to put down. I find this to be the best book Larry Swedroe has written, both due to its general readability and its content. One thing is certain: this book will not be found on the bookshelves of brokerage houses it puts the lie to just about everything they claim they can do." Edward R. Wolfe, PhD, Professor of Finance, Western Kentucky University

"If your crystal ball is working, don′t read this book. But if it′s cloudy and you care about your or your clients′ investments, you must read The Quest for Alpha. You may not discover the holy grail, but you will be a far better investor." Harold Evensky, President, Evensky & Katz Wealth Management

"Over the last forty years, researchers have produced a mountain of evidence documenting the advantages of a simple, low–cost, diversified approach to investing. Larry Swedroe has climbed this mountain and condensed their wisdom into a manageable volume that offers one–stop shopping. Anyone setting off on the path of managing their own money would do well to consult this comprehensive guidebook." Weston Wellington, Vice President, Dimensional Fund Advisors

"With his entertaining and easy–to–read writing style, Larry presents a clear and concise message that is supported by decades of research: hold a globally diversified portfolio of low–cost index funds and ETFs; harvest tax losses; and periodically rebalance. This winning strategy is how I manage my money, and it can help you prudently manage your portfolio, too." Dr. William Reichenstein, CFA, Professor of Finance, Baylor University

"Larry Swedroe uses his inimitable style with research findings to convey the message most investors do not want to hear and certainly do not want to believe the search for alpha is dominated by the ′wizards of advertising′ and, for relatively sophisticated investors, by the ′wizards of overconfidence.′" John A. Haslem, Professor Emeritus of Finance, University of Maryland; Editor of Mutual Funds: Portfolio Structures, Analysis, Management, and Stewardship

"Caution active investors: after reading this book, you′ll probably never be able to buy another active fund. In The Quest for Alpha, Larry Swedroe provides the most thorough and compelling evidence–based case for passive investing I′ve ever read." Mel Lindauer, Forbes.com columnist and coauthor of The Bogleheads′ Guide to Investing and The Bogleheads′ Guide to Retirement Planning