nun
Thinks s/he gets paid by the post
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So if absolutely everyone used John Bogle's AA and investing principles would we all die of boredom and yearn for the casino aspect of the stock market again.
So if absolutely everyone used John Bogle's AA and investing principles would we all die of boredom and yearn for the casino aspect of the stock market again.
He does not recommend the same AA for everyone, but he does prefer low expense, broad passive/index funds to fill out the appropriate AA for each individual (once determined). He's written several books, or you can Google and find lots of info. Here's just one summary:Where would I find JB's AA and investing principles? Does he recommend one size for all?
In summary, a Bogle investor tends to (1) save a lot, (2) select an asset allocation containing both stock and bond asset classes, (3) buy low cost, widely diversified funds, (4) allocate funds tax-efficiently, and (5) stay the course. One of the wonderful things about Bogle investing is that it generally only requires a part of a day to set up, and then about an hour a year of effort to rebalance. Beyond that, there is no need to watch the markets or follow financial news. Even better, it works.
If everyone drove the speed limit, road traffic would still move along just fine. If everybody indexed, indexing would fail (because no bargain hunters would be out there keeping prices in line).It would be like if everyone drove the speed limit.
I've read a lot, and thanks for the link. My question was about JB philosophy, not Bogleheads interpretation of same. I understand that they closely follow JB, but they do ignore certain JB maxims, like including SS as part of your AA.He does not recommend the same AA for everyone, but he does prefer low expense, broad passive/index funds to fill out the appropriate AA for each individual (once determined). He's written several books, or you can Google and find lots of info. Here's just one summary:
Bogleheads® investment philosophy - Bogleheads
Evidently you've read one or more of Jack Bogle's books, so I guess I didn't pick up on what you were asking. Sounds like you already have your own answer...cheers.I've read a lot, and thanks for the link. My question was about JB philosophy, not Bogleheads interpretation of same. I understand that they closely follow JB, but they do ignore certain JB maxims, like including SS as part of your AA.
I don't think JB intends that all investors go with one or two or three funds.
If everyone drove the speed limit, road traffic would still move along just fine. If everybody indexed, indexing would fail (because no bargain hunters would be out there keeping prices in line).
With indexing, it's more like "What if everyone was a doctor?" It's fine to be a doctor if other folks are choosing a wide variety of other careers, but it's not good if everybody does it.
one thing is certain and that would be the underlying stocks in these indexes would become so over valued as to be in a bubble. the real value would then become in the stocks outside the indexes and i think stock pickers would surpass those indexes.
you can't have the majority only buying the same stocks.
If everyone is passive and invested in passive funds then the function of the market intended to reward or punish business performance would be eliminated. This is bad.
Eventually, with an efficient market you get back into the issue of not being able to reliably pick winners. The random walk rules in the end. Good luck with that.
I think you will not break Bogleheads investing strategy if you buy excellent index funds like VIG or SCHD. Those index funds select what to buy based on things like earnings growth, competitive advantage etc etc. And they sport annual fees of 0.10 and 0.07 percent.
The above mentioned index funds will drive prices of their holdings. They are not passive.
I agree.
However, is active investing really a part of Bogle's investing principles?
Just cause Vanguard has a variety of funds doesn't mean they all align with the central Bogle strategy.
To me Bogles key points are to focus on very broad diversification, low costs and buy/hold.
That's not active investing.
Interesting, so indexers need the stock pickers to be successful. Maybe indexers should be a little less evangelical and should encourage the market timers and stock pickers in their own self interest.