I wasn’t sure what to expect when I opened this book. After all, the subtitle could lead one to expect some sort of sensationalistic attention-grabbing sort of “get rich quick” scheme. I was pleasantly surprised, to say the least.
I had not read any of author Tadas Viskanta’s writings prior to this book (I’ve since resolved that shortcoming – see Abnormal Returns, you won’t be disappointed!), so I didn’t realize how insightful and reasoned Mr. Viskanta’s commentary could be. What he has produced in this book is an excellent overview of the components of the investment environment these days. This book should be required reading for anyone who is investing these days – especially for the non-professional investor who is going it alone, without a professional advisor.
The author starts off with a thorough explanation of the concepts of Risk and Return, and then explains the basics of Stock (Equity) and Bond investments. These first four chapters provide a sound basis for a better understanding of investing – these are easily-understood explanations with real-world examples.
Building on the foundation of those chapters, Viskanta then explains Portfolio Management, with particular attention given to measurement of results against benchmarks. Additionally, the problems associated with leveraged investments and illiquidity in investments are discussed at length – including how to avoid these problems.
Mr. Viskanta then explains the problems that the individual investor experiences with Active Investing. As I’ve mentioned regularly, active investors are most often unsuccessful when compared to passive, index-oriented investors – and this premise is underscored with Viskanta’s explanations.
In the next section the book, Mr. Viscanta provides a thorough explanation of Exchange Traded Funds, Global Investing, and Alternative Investments – all important components of today’s investment world. Then to round out the book, there are chapters on investor behavior, better use of the media (hint: pay no attention!), and what we can learn from the “lost decade”.
All in all, an excellent book. I recommend this book regularly to folks who are hoping to build a foundation of knowledge about investing.
The above book review is part of a series of reviews that I am doing in an arrangement with McGraw-Hill Professional Publishing, where MH sends me books with the only requirement being that I read the book and write a review – like it or not. If you find the information in this review useful, let me (and McGraw-Hill) know!Click the link to pick up a copy of An IRA Owner's Manual or if you'd prefer the Kindle version (and let's face it, ALL the cool kids do!), you can find that at this Kindle version link.