Book Recommendation #2
As Brad previously noted, we’ll be trying to share a book with our readers about once a month. I thought it would only be proper for my first book recommendation to be a book which Brad recommended to me a couple years ago.
The Intelligent Asset Allocator by William Bernstein.
This is an excellent book for those of you looking to understand Asset Allocation, perform asset allocation on your own and understand why it works (historically and into the future). This book alone changed my financial agenda in regards to investments.
We live in a world that seems to be driven by individual stocks with thousands of blogs talking about them, people yelling at you to ‘buy buy buy’ and countless magazines ‘recommending’ specific stocks. For those of you reading, a couple of questions:
- Have you ever been trained in security analysis?
- Would someone pay you to perform this analysis?
- Why would you trust yourself to pick a couple ‘winning’ stocks out of thousands of options?
Read this book and your eyes will be opened to the world of asset classes and what true diversification is. Brad and I use theories pulled from this book in our own investments and highly recommend a balanced asset allocation approach. The author does a great job of backing up his theories with real data and for those of you looking to delve into the details (math) there are separate sections with miniature proofs.
The author, William Bernstein, has written several other books which others have told me are good reads as well. Has anyone read this book or his others? What are they and are they worth reading?
