The Four Pillars of Investing

[softweave]

I got this book a few years ago based on recommendations in this forum and have finally skimmed through most it. Is anyone following its recommendations? Especially, has anyone followed the recommended investment strategy over the past 3-4 years? If so, are you happy with the results you've gotten?

[razz]

I had read about this book before but did a quick update to verify and found this site for info to tweak further interest:
http://www.getrichslowly.org/blog/2008/07/08/the-four-pillars-of-investing/
The book is a good source of info but which Index Funds are a hard decision to make sometimes. Mutual funds in Canada have such high MER's that they are discouraging. It all makes sense from the Four Pillars approach.

[Charlie WA]

I read The Four Pillars of Investing by William Bernstein in 2003 and it was the best book that I've read on investing. I tweaked my portfolio to add large cap value, small cap value, and international large value funds. I'm happy with the results. It does require patience, since some asset classes may not do well for a long time. My S&P 500 index fund has been the worst performer over the last 10 years. The key is to stick with your plan and don't try to chase the best performing asset class. Also, I rebalance my portfolio once a year.

[Rogar]

I did a major reorganization of my finances four years ago after reading The Four Pillars and a couple of similar books, like A Random Walk Down Wall Street. Since then, my investments have been loosely based on the books. Obviously, with the DOW at 14,000 about the time that I reorganized, I don't have a lot to brag about, but am still very positive about indexed equity funds in a few diverse areas with a buy, hold, and re-adjust strategy. In my mind it is the best way and I seem to have fared better than most. I'm always more conservative in equity investments than the mainstream books recommend, and have never regretted that.

When the DOW was hovering in the 7000-9000 range I adjusted back into equities, and am showing a positive return on them over the four years, although it's meager.

I probably was light on bond funds compared to percents the Four Pillars might have suggested, with my interest bearing investments weighted to CD's and inflation protected U.S. treasuries. I've not regretted the inflation protected securities, but would have done better with more money in bond funds. So maybe Bernstein was right there too.

I actually just gave my book to the library, as I was thinking it was getting a little outdated. It would be interesting to see a similar book updated with historical figures an philosophy after the financial meltdown. I've not followed it religiously, as he seems to make more of a science of studying historic returns than I think is deserved.

[redfox]

I love reading these posts... like I dropped down to another planet! We are so far away from any kind of investing that I think I shall never do so... but one can hope.