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duskdawns · 09-17-2009, 06:38 PM

This really seems like Investing for Dummies/Personal Finance for Dummies/Mutual Funds for Dummies and other similar books in those series.

The book is too basic for anyone with a finance/investment/business background, but might be useful for someone without that knowledge whatsoever.

For those who don't know, index-fund investing is simple because your portfolio holdings just track whatever index it is linked to, whether it's the Dow Jones Industrials, NASDAQ, S&P 500 or other market indices.

If the index goes up, the value of your portfolio does too, and vice-versa. If you had investments in an index-fund over the last year or so, it would have gone down, down, down in the bear market- although it's now retracing from its fall to the bottom, it's still way off from the highs reached in October 2007.

Although it can sometimes be superior to managed funds, the reverse is also true that managed funds can outperform indexed funds.

Also, managed funds can be lower cost as well, such as no-load mutual funds. The investor should seek funds with no or the lowest commissions/managing fees.

I would suggest to the novice investor to read this book, but keeping in mind it is only one component of all investments: equity (domestic and international stock), mutual funds and ETFs(exchange-traded funds), fixed income (corporate and government bonds), commodities, treasuries, real estate, foreign currencies, cds and other money market instruments, etc.

And then pick up a more comprehensive guide to basic investing.

09-17-2009, 06:38 PM	#5
duskdawns Enthusiast Posts: 42 Karma: 840 Join Date: May 2009 Device: none	This really seems like Investing for Dummies/Personal Finance for Dummies/Mutual Funds for Dummies and other similar books in those series. The book is too basic for anyone with a finance/investment/business background, but might be useful for someone without that knowledge whatsoever. For those who don't know, index-fund investing is simple because your portfolio holdings just track whatever index it is linked to, whether it's the Dow Jones Industrials, NASDAQ, S&P 500 or other market indices. If the index goes up, the value of your portfolio does too, and vice-versa. If you had investments in an index-fund over the last year or so, it would have gone down, down, down in the bear market- although it's now retracing from its fall to the bottom, it's still way off from the highs reached in October 2007. Although it can sometimes be superior to managed funds, the reverse is also true that managed funds can outperform indexed funds. Also, managed funds can be lower cost as well, such as no-load mutual funds. The investor should seek funds with no or the lowest commissions/managing fees. I would suggest to the novice investor to read this book, but keeping in mind it is only one component of all investments: equity (domestic and international stock), mutual funds and ETFs(exchange-traded funds), fixed income (corporate and government bonds), commodities, treasuries, real estate, foreign currencies, cds and other money market instruments, etc. And then pick up a more comprehensive guide to basic investing.