Customer Reviews


28 Reviews
5 star:
 (24)
4 star:
 (4)
3 star:    (0)
2 star:    (0)
1 star:    (0)
 
 
 
 
 
Average Customer Review
Share your thoughts with other customers
Create your own review
 
 
‹ Previous | 1 2 3 | Next ›
Most Helpful First | Newest First

9 of 9 people found the following review helpful
4.0 out of 5 stars Where Was the Final Chapter?, Dec 5 2002
By A Customer
This review is from: The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk (Hardcover)
This book makes a compelling case for an approach to investing that won't get your adrenalin running, but will probably make (or save) you more money than any other approach over the long run. Bernstein builds on academic financial theory and historical analysis to argue that you should (a) diversify your portfolio between stocks and bonds, (b) use low cost index (mutual) funds for the stock portion of your portfolio, and (c) rebalance your portfolio periodically to keep your assets in line with your target allocations. And let's be honest - Bernstein is completely correct. If you'd followed his advice, you wouldn't have been caught with a portfolio of tech stocks at the height of the bubble...
But Bernstein's book has one glaring failing. In the last year, the tools have become available for individual investors to pursue exactly the strategy Bernstein advocates with great ease at exceptionally low cost. But Bernstein hardly discusses these tools, and fails to acknowledge their advantages.
These tools are Exchange Traded Funds (ETFs). If you look at Barclays I-shares (there's a web site devoted to them), for example, you'll find a complete set of exchange traded index funds covering US and foreign markets, individual sectors, and divisions of the market by market cap and style (such as small cap/large cap, growth/value).
ETFs offer compelling advantages to individual investors. They are:
(1) ETFs have lower expense ratios than mutual funds. The Barclays I-shares S&P 500 ETF charges 0.09% a year in fees, compared to about double that for the Vanguard 500 Index Fund.
(2) ETFs are easier to manage from a tax perspective. Don't think this is trivial - it will probably have an immense impact on your after-tax performance. Because ETFs trade like stocks, online brokers ...will show you which lots you have unrealized capital losses on. So at the end of each year you can sell your S&P 500 ETF, realize a capital loss, and put the money into a combination of the S&P 500 Growth ETF and the S&P 500 Value ETF - which amounts to the same thing but allows you to claim up to a $3000 deduction off your tax return. Mutual funds make it much harder if not impossible to track gains and losses and specify individual tax lots for sale.
(3) You can use limit orders on ETFs, which you cannot for mutual funds. Don't think this is an advertisement for day trading - it's not. Following Bernstein's model, you want to trim your asset allocation if one asset rises steeply in price ahead of the rest of your portfolio. Setting Good 'till Cancel limit orders is a great way to keep your portfolio in balance, and to benefit from sharp intra-day movements.
(4) Some of the best online brokers offer portfolio analysis tools that allow you to track your portfolio allocation easily if you keep all your assets in a single account. Since ETFs look like stocks (including the bond index ETFs), it's easy to keep all your assets in a single account. For example, [there is one ETF], which has a bank as well as a brokerage under one roof, allows you to move funds instantaneously between a high interest bearing money market bank account (currently paying about 2.4%) and a brokerage account. This allows you to keep your cash, stock and bond allocations under a single roof, to monitor your total asset allocation, and to move assets from one class to another with ease. In contrast, if you hold multiple mutual fund and savings accounts, it's harder to track your asset allocation and to move funds between asset classes.
The downside of ETFs, compared to mutual funds, is the cost of trading. Online brokerages now charge a [fee for each] trade (ETFs trade just like stocks), so if you rebalance frequently and your assets are not large, you'll want to monitor your trading costs carefully. It may even make sense to use mutual funds instead (you don't pay for buying and selling no-load mutual funds). But for most individuals, I believe that ETFs will prove more profitable than mutual funds, mainly due to the greater ease of tax management and lower expense ratios.
So a discussion of ETFs and a model portfolio using them is the final - missing - chapter of this book. Go read the book anyway - it's a great book. But until Bernstein updates his book, this review - and the free online material at ABetterWayToInvest.com - will have to stand in for that final, missing chapter.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


2 of 2 people found the following review helpful
4.0 out of 5 stars Almost great, July 29 2002
By 
R. WHITTEN "rick_whitten" (Fresno, CA USA) - See all my reviews
(REAL NAME)   
This review is from: The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk (Hardcover)
There is nothing in this book with which I disagree. My only criticism has to do with readability, an admittedly subjective quality. I read this book after finishing "Four Pillars", and I have to say that the latter is a better written book. If you are into mathematical proof of the principles of index investing, asset allocation and rebalancing, and have a long-term investment horizon, this book is a gem. As a ten year convert to this investing style, I have to say with gratitude that I am glad that I was enlightened when I was. People like Bernstein, Bogle, Malkiel and Swedroe have democratized the investment world to all our benefit.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


2 of 2 people found the following review helpful
5.0 out of 5 stars Don't be scared, Feb. 4 2004
By 
Chris A. Johnson "scarmoco" (Dubuque, IA USA) - See all my reviews
(REAL NAME)   
This review is from: The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk (Hardcover)
When you pick up this book and look through it the graphs my scare you. Don't let your math phobia kick in. William Bernstein does a great job of walking you through each chapter. In fact at the end of one of the first chapters he tells you to put the book down for a few days and just digest the information. I would rate myself as at least an investor with moderate investing knowledge. I found this book helpful and the charts held validate the points Mr. Bernstein is making. I suspect I will refer to it often when I have a guestion about investing.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5.0 out of 5 stars Diversify Your Assets, June 5 2002
By 
This review is from: The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk (Hardcover)
You can make a lot of money in the stock market. You can also lose a lot of money; this book explores modern thinking about the tradeoffs that determine risk and return in investing. Starting from the premise that statistical analysis provides the tools needed to evaluate risk, the author proceeds from there to present analyses based on modern research in economics and finance.
The average investor may not like the authors premise, since it surmises that markets are reasonably efficient in pricing asssets and that the average investor faces very daunting odds when trying to outperform the market. The analyses fly in the face of most popularly available investing advice, which dwells on predicting trends, picking stocks and market timing. Most investors believe that they can predict the market to some degree (see Bernstein's "Four Pillars" book on overconfidence, or one of the previous reviewers), but Bernstein contends that the market performs in surprising ways that prevent the prediction of returns over short periods.
The evidence for this unpredictability, provided in this and the author's other works (The "Pillars" book and his web site, The Efficient Frontier) is compelling. How much risk does the investor endure while modeling the market based on previous performance? Some aspects of risk and return for broadly defined asset classes are quantifiable, and these quantitations are discussed in the present volume.
My criticisms are minor; I think the author foreshadows the text's math difficulty way too much (most of the public is math averse, I hear). You might read the "Pillars" book first if you are uncertain of your math skills ... anyone familiar with topics like covariance and autocorrellation will breeze through the math in this book. The disclaimer (after some buildup) of MVO backtesting in the middle of the book is a bit of a letdown, but the allocation strategies in the "Pillars" book undo that to some degree. Otherwise, an enthusiastic recommendation. I recommend that every investor read this or the "Pillars" book and apply these ideas carefully and objectively to their own investment strategy.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5.0 out of 5 stars The Intelligent asset allocator, Nov. 29 2001
By 
john a horstkamp (duluth, mn United States) - See all my reviews
This review is from: The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk (Hardcover)
This is a superb investment book. Bernstein first covers basic statistical topics and historical risk and return data for stocks, bonds and bills. He then presents a lucid discussion of portfolio theory and its applications for the small investor. The most important result of this theory is that the risk and return of a portfolio are very different from the risk and return of its constituent parts, so that adding a 'risky' asset to a portfolio can actually decrease the portfolio's overall volatility. This discussion requires only minimal mathematical background. Bernstein then takes on the controversial topic of market efficiency. He also describes stock valuation models, current valuation levels, growth and value investing, Fama and French's three factor model, the concept of the efficient frontier and numerous other important topics in finance. But the discussion throughout is very clear and understandable as well as practical. After making a compelling case for index investing with periodic rebalancing, Bernstein presents helpful Vanguard and DFA model portfolios. What the author has done is to take the most significant results from academic finance and translated them into English for the individual investor. He has done investors a great service.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5.0 out of 5 stars Very good but with some inconsistencies., Oct. 18 2001
By A Customer
This review is from: The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk (Hardcover)
This book is a very good read that kept my attention. The book focuses on low-cost index fund oriented investing across various types of investments and is a good companion book to A Random Walk Down Wall Street. The author looks at both investment theory and how the theory applies to actual market history. Although the theory can involve a little too much math at times for some readers, this is not a problem as the author's point comes across clearly.
Although the book was generally excellent, some of the author's points are inconsistent. For example, the author talks at length about how future returns are unpredictable but later states that stock prices are overvalued and due for a downturn. Additionally, the author stresses how periodic portfolio rebalancing is important in asset allocation but then says that there is a strong argument for never rebalancing due to tax consequences. However, these inconsistencies are insignificant to the work as a whole and I strongly recommend this book.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5.0 out of 5 stars Very good but with some inconsistencies., Oct. 18 2001
By 
J. Krogmeier (Wilmington, DE United States) - See all my reviews
This review is from: The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk (Hardcover)
This book is a very good read that kept my attention. The book focuses on low-cost index fund oriented investing across various types of investments and is a good companion book to A Random Walk Down Wall Street. The author looks at both investment theory and how the theory applies to actual market history. Although the theory can involve a little too much math at times for some readers, this is not a problem as the author's point comes across clearly.
Although the book was generally excellent, some of the author's points are inconsistent. For example, the author talks at length about how future returns are unpredictable but later states that stock prices are overvalued and due for a downturn. Additionally, the author stresses how periodic portfolio rebalancing is important in asset allocation but then says that there is a strong argument for never rebalancing due to tax consequences. However, these inconsistencies are insignificant to the work as a whole and I strongly recommend this book.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5.0 out of 5 stars How's Your 401(k)? Do It a Favor -- Read This Book, Aug. 29 2001
By 
Scott Snyder (Northern California) - See all my reviews
(REAL NAME)   
This review is from: The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk (Hardcover)
I would have to agree with John Bogle's endorsement: "This is a great book!"
While Malkiel's Random Walk covers Modern Portfolio Theory, Bogle covers the virtues of index investing, and Graham, Lynch and Fisher cover individual stock selection, studies show that asset allocation alone is responsible for over 90% of a portfolio's performance in the long run. Yet asset allocation theory seems to me to be under-represented in the investment literature for non-professionals.
Bernstein's book goes a long way to correct this gap. He starts out almost too simply. Bernstein takes the reader step-by-step through a discussion of basic financial math and statistics (hitting variance and correlation coefficients in particular) as he builds the case and explanation behind asset diversification. He writes to an intelligent audience but does not assume a mathematical or financial background. I like that he encourages the reader to take a chapter at a time. He instructs the reader to finish the chapter, and then put the book down and get back to life. This adds to the methodical tone of the book: a step at a time.
In the final chapter "Odds and Ends" the author changes gears. Suddenly we are in the world of - well - odds and ends, the finer points of portfolio management. This was the most interesting part of the book for me. Here Bernstein reviews the case for index investing and - of special interest to me - value investing. What is the premium in returns for small vs. large caps, value vs. growth? Which MPT stat, P/E or P/B is the better predictor of future performance? Why is value averaging so important and yet so counter intuitive? This chapter alone was worth the price of the book.
Finally, Bernstein shares the wealth. The bibliography and recommending reading sections are terrific. This alone might be worth twice the price of the book.
In a time when we are all more intimately involved with the management of our retirement accounts, I cannot recommend this book highly enough to anyone and everyone. You cannot afford not to be familiar with the contents of this book. Highly recommended.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5.0 out of 5 stars An Essential Tool For Serious Investors, March 22 2001
By 
Ron A Rhoades (Lecanto, FL United States) - See all my reviews
This review is from: The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk (Hardcover)
Dr. Bernstein's excellent presentation in this text of Modern Portfolio Theory (in particular, mean-variance analysis) and his three-step approach to asset allocation should not be overlooked by the serious investor or by investment advisors. While some background in statistics would be helpful to the reader, don't run away if you are not a mathmetician. Read the chapters slowly, one at a time, and you'll gain valuable insights into the all-important asset allocation decision. No other text I've read to date better explains Modern Portfolio Theory and the underlying theories of asset allocation to the lay investor.
Dr. B effectively presents additional arguments for value investing and tax-efficient investing. The last chapter also contains a very useful reading list, providing a synopsis of books by Malkeil, Bogle, Haugen, and a host of web sites which can provide valuable data and reading. Investors should not overlook Dr. Bernstein's own web site, which is frequently updated with his newsletters.
The very beginning investor should perhaps first explore Bogle's Common Sense on Mutual Funds, and then explore texts by Burton Malkeil, Larry Swedroe, and perhaps a few others. This text can then be dived into (patiently). Bruce Temkin's recent text, The Terrible Truth About Investing, should then follow, lest the individual investor believe that he or she knows it all.
I highly recommend this text as an addition to every serious individual investor's library, and to investment advisors desiring to explore the fundamentals of Modern Portfolio Theory.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5.0 out of 5 stars An excellent book for serious investors only., March 5 2001
This review is from: The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk (Hardcover)
... Being an investment advisor specializing in asset class strategies, I was immediately impressed with his grasp of the principles of modern portfolio theory, the efficient market hypothesis, and his incredible knowledge of statistics. What impresses me even more is that he has been able to take these fairly academic topics and communicate them very effectively to serious investors who wish to build and maintain wealth over the long-term. By the way, a serious investor to me has nothing to do with the size of their portfolio. It has everything to do with their desire to learn and apply sound, logical, fact-based principles while recognizing and ignoring the vast amount of Wall Street garbage touted by stockbrokers and other salesmen.
There are other reasons to be impressed with Bill and the knowledge he has imparted through this book. For one, Bill is a practicing physician, a neurologist, in fact. And-trust me on this-physicians are the world's worst investors. They tend to change investment strategies and advisors more often than Liz Taylor changes husbands. Why? My theory is that physicians are the most "cold-called" group of investors in the world. They hear every story from every angle and are always in search of the highest promised return on their investments. As a result, they have a habit of buying high and selling low whether with individual securities, mutual funds, or investment advisors. Dr. Bernstein probably did that a few times himself and-recognizing a nervous system disorder when he sees one-decided to find the truth on his own. He found it.
In other words, he's one of you, only he's been subjected to even more of the worthless Wall Street noise then you have. Investors who take the time to read this book all the way through and grasp some of the finer details, will be extremely well served. If they only read Chapter 5 on asset allocation, however, they will know more than 90% of investors and be well on their way to a successful, long-term strategy.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


‹ Previous | 1 2 3 | Next ›
Most Helpful First | Newest First

This product

The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk
CDN$ 38.95 CDN$ 24.42
In Stock
Add to cart Add to wishlist
Only search this product's reviews