Bogle On Mutual Funds: New Perspectives For The Intelligent Investor (Wiley Investment Classics)

John C. Bogle, founder of The Vanguard Group of Investment Companies, is both a dynamic leader in the mutual fund industry and its most outspoken critic. Best known for his crusade against unfair treatment of mutual fund clients, Bogle has built a $100 billion mutual fund company on principles of candor, fairness, and low cost. Bogle on Mutual Funds is his straightforward assessment of the industry he knows so well, written for the investor who wants a true and unflinching portrayal. Bogle not only explains the basic principles of canny mutual fund investing, but also explores its subtle nuances and exposes the hype and fads that often lure investors into making unwise decisions. Rather than a quick route to "wealth without risk, " this conscientious guide offers strategies for developing a diversified portfolio that will weather the market's short-term variations. With painstaking care, Bogle warns the reader of the major pitfalls common to mutual fund investing. This is the book to read if you are serious about mutual funds. Encouraging investors to take into account their investment attitudes, their position in the "life cycle" of an investment program, and the behavior of the securities markets over the long run, Bogle on Mutual Funds provides a solid framework for establishing a long-term investment portfolio, one based on sensible selections from among the thousands of stock funds, bonds funds, and money market funds available in this burgeoning industry. Every intelligent investor should read what Jack Bogle has to say about mutual funds. BOGLE ON MUTUAL FUNDS 3 How Bogle on Mutual Funds Became a Classic 9 Persistence and Publication 9 Opportune Timing, Powerful Endorsements 10 A Perspective on BOGLE ON MUTUAL FUNDS 14 Perspective One. Index Funds 15 Perspective Two. Fund Costs 16 Perspective Three. Taxes 17 The Practical Application of Sound Principles 18 “A Mandate for Mutual Fund Shareholders” 19 Building a New Industry 20 “The Twelve Pillars of Wisdom” 21 Reflections on What Makes a “Classic” 22 The Classics 22 Tests that Define My Work 23 Coming Full Circle 24 Foreword 27 Acknowledgments 29 Preface 31 Contents 37 Caveat Emptor Index 39 Part I Building Blocks 41 1 The Rewards of Investing: The Magic of Compounding 43 A Long-Term Perspective 44 Total Returns on Common Stocks 47 Total Returns on Bonds 53 Total Returns on Cash Reserves 58 The Magic of Compounding for Todays Investor 60 Summary 63 2 The Risks of Investing: Do What You Will, Capital Is at Hazard 64 The Risk of Inflation 64 The Risks of Common Stocks 69 Total Return Risk 69 Principal Risk 73 Income Risk 74 The Risks of Bonds 76 Total Return Risk 77 Principal Risk 81 Income Risk 83 The Risk of U.S. Treasury Bills 84 Total Return Risk 84 Income Risk 86 Summary 86 3 Mutual Funds: Principles, Practicalities, Performance: An Idea Whose Time Has Come 88 Four Basic Principles 90 The Practicalities of Selecting a Fund Complex 96 Mutual Fund Performance 100 Summary 104 Part II Mutual Fund Selection 105 4 How to Select a Common Stock Mutual Fund: Let’s Look at the Record 107 Structural Characteristics 116 Size of Fund 117 Age of Fund 118 Tenure of Portfolio Manager 118 Cost of Ownership 119 Portfolio Characteristics 119 Portfolio Statistics 121 Evaluating Past Performance 125 Summary 134 5 How to Select a Bond Mutual Fund: Attention Must Be Paid 137 Structural Characteristics 140 Age and Size of Fund 140 Tenure of Portfolio Manager 140 Relative Yields 141 Cost of Fund Ownership 142 Portfolio Characteristics 144 Tax Implications 149 Evaluating Past Performance 151 A Closer Look at High-Yield Bond Funds 155 Summary 158 6 How to Select a Money Market Fund: A Penny Saved 160 Structural Characteristics 164 Management 165 Portfolio Quality 165 Cost of Fund Ownership 166 Relating Return to Risk 168 Tax-Exempt versus Taxable Money Market Funds 169 Evaluating Past Performance 170 A Lot More Pennies 172 Summary 173 7 How to Select a Balanced Mutual Fund: The Golden Mean 175 Structural Characteristics 177 Evaluating Past Performance 180 Summary 184 8 Where to Get Mutual Fund Information: Knowledge Is Power 187 Fund Prospectuses and Annual Reports 187 Statistical Manuals 192 The Financial Press 199 Mutual Fund Newsletters 202 Summary 205 Part III New Perspectives on Three Key Issues 207 9 Index Funds: And There Is! 209 The Efficient Market Principle in Theory...and In Practice 210 New Ways of Indexing 220 Moving Beyond Stock Investing 225 Summary 228 10 Mutual Fund Costs: The Price of Everything 230 Sales Charges 232 Loads on Reinvested Dividends 235 Expense Ratios 237 The Invisible Cost 243 Total Costs Paid by Shareholders 246 Summary 248 11 Taxes and Mutual Funds: The Power to Destroy 249 Taxes on Investment Returns 249 Taxes Paid by Mutual Fund Shareholders 252 Special Tax Considerations for Mutual Fund Investors 253 How to Defer Taxes 260 Variable Annuities 263 Income Exempt from Federal Taxes 267 Income Exempt from State Taxes 270 Summary 272 Part IV Practical Application of Investment Principles 273 12 The Allocation of Investment Assets: The Intelligent Investor 275 Elements of the Asset Allocation Portfolio 280 Should Your Asset Allocation be Rebalanced Periodically? 281 Tactical Asset Allocation 285 Can You Increase Return Without Increasing Risk? 293 Summary 297 13 Mutual Fund Model Portfolios: Getting Down to Brass Tacks 299 The Accumulation Investor 303 The Transition Investor 306 The Distribution Investor 308 The LUMP-SUM Investor 312 The Institutional Investor 315 Summary 319 14 A Mandate for Fund Shareholders: The Fault, Dear Brutus 320 The Canny Investor 321 The Thrifty Investor 323 The Active Investor 324 The Skeptical Investor 330 The Role of the Independent Director 336 Building a New Mutual Fund Industry 338 Summary 342 Epilogue: Twelve Pillars of Wisdom: Wisdom excelleth folly 343 Notes 348 Index 351 John C. Bogle 370 EULA 371 This work provides investors with the wisdom of the pioneer of mutual funds to help you identify and execute the ideal mutual fund investment choices for your portfolio. The seminal work on mutual funds investing is now a Wiley Investment Classic Certain books have redefined the way we view the world of finance and investing-books that should be on every investor's shelf. Bogle On Mutual Funds-the definitive work on mutual fund investing by one of finance's great luminaries-is just such a work, and has been added to the catalog of Wiley's Investment Classic collection. Updated with a new introduction by expert John Bogle, this comprehensive book provides investors with the wisdom of the pioneer of mutual funds to help you identify and execute the ideal mutual fund investment choices for your portfolio. The former Vanguard Chief Executive, Bogle has long been mutual funds' most outspoken critic; in this classic book, he provides guidance on what you should and shouldn't believe when it comes to mutual funds, along with the story of persistence and perseverance that led to this seminal work. You'll learn the differences between common stock, bond, money market, and balanced funds, and why a passively managed "index" fund is a smarter investment than a fund managed by someone making weighted bets on individual securities, sectors, and the economy. Bogle reveals the truth behind the advertising, the mediocre performance, and selfishness, and highlights the common mistakes many investors make. Consider the risks and rewards of investing in mutual funds Learn how to choose between the four basic types of funds Choose the lower-cost, more reliable investment structure See through misleading advertising, and watch out for pitfalls Take a look into this timeless classic and let Bogle On Mutual Funds show you how to invest in mutual funds the right way, with the expert perspective of an industry leader

The seminal work on mutual funds investing is now a Wiley Investment Classic

Certain books have redefined the way we view the world of finance and investing--books that should be on every investor’s shelf. Bogle On Mutual Funds--the definitive work on mutual fund investing by one of finance’s great luminaries--is just such a work, and has been added to the catalog of Wiley’s Investment Classic collection. Updated with a new introduction by expert John Bogle, this comprehensive book provides investors with the wisdom of the pioneer of mutual funds to help you identify and execute the ideal mutual fund investment choices for your portfolio.

The former Vanguard Chief Executive, Bogle has long been mutual funds' most outspoken critic; in this classic book, he provides guidance on what you should and shouldn't believe when it comes to mutual funds, along with the story of persistence and perseverance that led to this seminal work. You'll learn the differences between common stock, bond, money market, and balanced funds, and why a passively managed "index" fund is a smarter investment than a fund managed by someone making weighted bets on individual securities, sectors, and the economy. Bogle reveals the truth behind the advertising, the mediocre performance, and selfishness, and highlights the common mistakes many investors make.

• Consider the risks and rewards of investing in mutual funds
• Learn how to choose between the four basic types of funds
• Choose the lower-cost, more reliable investment structure

• See through misleading advertising, and watch out for pitfalls

Take a look into this timeless classic and let Bogle On Mutual Funds show you how to invest in mutual funds the right way, with the expert perspective of an industry leader. John C. Bogle, founder of Vanguard, thoroughly discusses the risks and rewards of investing in mutual funds. He explains how to select among the four basic categories of funds: common stock, bond, money market, and balanced. He argues convincingly that a passively managed "index fund" costs less and is more reliable than a fund managed by someone making weighted bets on individual securities, sectors, and the economy. Bogle, long the mutual fund industry's loudest critic, denounces its misleading advertising, mediocre performance, and selfishness. Sprinkled throughout the text are "caveat emptor" boxes that warn readers of the hidden pitfalls of mutual fund investing. Includes a new introduction by the author. --Publisher's description. John C. Bogle, founder of Vanguard, thoroughly discusses the risks and rewards of investing in mutual funds. He explains how to select among the four basic categories of funds: common stock, bond, money market, and balanced. He argues convincingly that a passively managed "index fund" costs less and is more reliable than a fund managed by someone making weighted bets on individual securities, sectors, and the economy. Bogle, long the mutual fund industry's loudest critic, denounces its misleading advertising, mediocre performance, and selfishness. Sprinkled throughout the text are "caveat emptor" boxes that warn readers of the hidden pitfalls of mutual fund investing. Includes a new introduction by the author.--Publisher information The smarter approach to mutual fund investing, from the industry-defining expert Bogle On Mutual Funds contains the industry-defining wisdom of the mutual fund pioneer John C. Bogle to help you identify and execute the ideal mutual fund investment for your portfolio. The former Vanguard Chief Executive, Bogle has long been mutual funds' most outspoken critic; in this book, he gives you the low down on what you should and shouldn't believe when it comes to mutual funds. You'll learn the differences between common stock, bond, money market, and balanced funds, and why a passively managed ""inde