The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (Little Books. Big Profits)
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The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (Little Books. Big Profits)
Any significant divergences between the two are short-lived.
S&P 500 Total Stock Market Index Rank Weighting Rank Weighting Apple Inc. 3.2% Apple Inc. 2.5% Microsoft Corp. 2.5 Microsoft Corp. 2.0 Alphabet Inc. 2.4 Alphabet Inc. 2.0 Exxon Mobil Corp. 1.9 Exxon Mobil Corp. 1.6 Johnson & Johnson 1.6 Johnson & Johnson 1.3 Berkshire Hathaway Inc. 1.6 Berkshire Hathaway Inc. 1.3 JPMorgan Chase & Co
... See moreIn 2016, over 150 percent of net investor cash flow went to funds rated four or five stars by Morningstar, the statistical service most broadly used by investors in evaluating fund returns.
Morningstar overwieghts recent performance and, as such, has been shown not be a terribly good predictor of fund success.
So today, why would an intelligent investor hold any bonds at all? First, because the long run is a series of short runs, and during many short periods, bonds have provided higher returns than stocks. In the 117 years since 1900, bonds have outpaced stocks in 42 years; in the 112 five-year periods, bonds have outpaced stocks 29 times; and even in t
... See moreA low-cost all-market fund, then, is guaranteed to outpace over time the returns earned by equity investors as a group.