The John Bogle Blog and His Financial Article About ETFs
John C. Bogle’s Blog and his article about ETFs
This article is a heads-up to people interested in investment blogs and personal finance blogs.
John C. Bogle, the founder of The Vanguard Group, Inc., has a blog called The Bogle eBlog. (If you are wondering about “eBlog,” it is an anagram of Bogle.) Mr. Bogle just posted an excellent article about the proliferation of exchange-traded funds (ETFs), which is a reprint of his Op-Ed article in today’s Wall Street Journal. If you are not a WSJ subscriber, you can find a link on his blog to a .pdf file of the full article.
His article is titled, ‘Value’ Strategies. In it, Mr. Bogle states that ETFs can be interchangeable with classic index funds, but only if you select and manage them in a manner in keeping with the original rationale for index mutual funds. This rationale includes very broad market diversification, very low costs, and buying-and-holding to match closely the broad market’s return. However, the current ETF market place seems to be heading in directions that are probably not in the best interests of individual investors. The proliferation of hundreds of ETFs has lead to positions in extremely narrow market segments, higher management expenses, and higher trading costs for the average ETF.
I wanted to make you aware of Mr. Bogle’s excellent ETF article and his blog, so I will stop at this high level summary. If you want to read this very informative article, click on one of the links above.
In addition, here is an idea for bloggers. Unfortunately, at this point Mr. Bogle’s blog is a bit hidden in the cyberweeds. However, I am also guessing that Mr. Bogle feels little need to spend time trying to drive up his link counts. Bloggers can help to make his blog more prominent. I suggest those of you who have blogs and are willing to do so put a link to Mr. Bogle’s blog in your blogroll. If enough of us do this, it will lift his blog ranking. The link to “The Bogle eBlog” is http://johncbogle.com/wordpress/
I suggest we do this, because what Mr. Bogle publishes on his blog is likely to be of interest to many financial blog readers. He is one of the truly honest men in the financial world. I personally I have tremendous respect for Mr. Bogle’s contribution to the financial welfare of individual investors. While index funds are an obvious financial idea to almost everyone now and they hold 10% of total mutual fund assets, in the 1970s most people in finance thought that indexing was completely nuts. If you want to understand the environment of that time better, I suggest that you read “The Constellation” chapter of Peter Bernstein’s book, Capital Ideas. In that chapter, he discusses the resistance to the very earliest index fund pioneers at Wells Fargo who tried to launch an index fund, the Stagecoach Fund, which really did not get off the ground and died in the bear market of 1974. Mr. Bogle finally got the first successful index fund off the ground beginning in 1975.
Tags: exchange traded funds
Personal Financial Planning
- Retirement Savings Needs of Renters Without Financial Planning Improvements (Retirement savings needs of renters prior to any financial planning improvements
Starting to plan with a non-optimal baseline projection
Fran and Fred Frugal, both age 30, are a married working couple with $100,000 in combined annual earned income. They want to understand how valuable different personal finance strategies could be to their lifetime finances and retirement security. [...])
- Part 4 of the Biggest Personal Finance Story of the Past 30 Years ( < <-- Go to Part 3
The Biggest Personal Finance Story of the Past 30 Years - Part 4
What does it mean to individual investors that the financial services industry is now about 21% of S&P 500 market capitalization?
(For a graph of the relative percentage shares of various sectors within the S&P500 index over [...])
- Fidelity Contrafund (FCNTX) gains a +5 Fund Authority Score (
The diversified investment fund strategy of the Fidelity Contrafund (FCNTX)
According to its prospectus filing on the U.S. Securities and Exchange Commission EDGAR system, the investment strategy of the Fidelity Contrafund is to invest primarily in common stocks and particularly in the "securities of companies whose value Fidelity Management & Research Company believes is not fully [...])
- The Lifetime Value You Have Lost by Paying Investment Sales Loads (VeriPlan can estimate the lost lifetime value of investment sales loads that you have already paid in the past
Your personal investment portfolio losses related to past investment sales load payments can and should be measured, when you evaluate the cost-efficiency of your investment strategy.
However, you cannot recapture any of the lost returns (past or future) [...])
- Using Google Scholar to Find Financial Articles (
Using Google Scholar to Find Finance Articles
If you want to do some research about financial planning and investing by yourself, try using Google Scholar.
Be prepared for a lot of the material you find to be esoteric. Nevertheless, Google Scholar is littered with diamonds that can improve your understanding of personal finance and save you money.
- Investment Valuation and Securities Risk for Individual Investors (
The securities markets provide an evolving consensus of the risk-adjusted value of particular securities.
By understanding how the markets value securities, individual investors can chose more durable investment strategies
Judging the potential usefulness of different investment strategies requires some understanding of what the public securities markets really do. This article discusses how the markets price financial securities [...])
- Most Individual Investors Are Poor Personal Portfolio Managers (Most individual investors are poor investment portfolio managers
Investors more easily understand investment costs that are directly measurable, such as fees deducted on investment statements. However, many investors ignore or are unaware of the “opportunity costs” of their sub-optimal investment behaviors. Opportunity costs are usually much more difficult to measure directly, but these investment costs can [...])
- Monitor and adjust your financial plan in a time-efficient manner – Step 9 of 10 Financial Planning Steps in the Right Direction (CLICK HERE TO READ THE SKILLED INVESTOR's OTHER ARTICLES ABOUT THESE "10 FINANCIAL PLANNING STEPS IN THE RIGHT DIRECTION
Time in life is the most precious and perishable asset that a person has. It should be spent enjoyably and efficiently. Scientific investment strategies that rely on relatively efficient financial markets allow people to minimize their time [...])
- American Funds – Income Fund of America – Class A Shares (AMECX) rate a +2 Fund Authority Score (Fund Authority Scores rate mutual funds and exchange traded funds (ETFs) on the most important economic factors that influence individual investors' net long term diversified investment fund performance. The Skilled Investor developed the Fund Authority Score system to provide individual investors with concise and objective summaries of mutual funds and ETFs for comparisons within investment [...])
- State Street Global Advisors S&P 500 Index Fund (SVSPX) wins the Best +10 Fund Authority Score (The table below in this article presents The Skilled Investor's Fund Authority Score and other information for the SSgA S & P 500 Index Fund (SVSPX). The Skilled Investor has also published an article about lower cost S&P 500 index mutual funds that you can read, which is entitled: Low Cost S&P 500 Index Mutual [...])
- How to distinguish between true investment skill and luck (
Even if an investor has obtained superior results over an extended period, is this sufficient proof that these investment results were actually due to skill rather than just a lucky streak?
No, these investment results could still be due to chance. For example, take a large population, such as all individual investors in the U.S., and [...])
- How to Lie with Statistics – Investment Performance Charts (How to lie with statistics: Investment performance charts - A Tip from The Skilled Investor
Darrell Huff wrote a short and very informative book, "How to Lie with Statistics," which was first published in 1954 and was amusingly illustrated by Irving Geis. This book is still in print and remains very popular (Amazon book rank #2,040 [...])
- Avoid Mutual Fund and ETF Sales Commissions and Fees (Avoid mutual funds and ETFs with sales commissions and marketing fees
Summary: There is no convincing evidence that sales loads and other sales fees charged to investors result in higher mutual fund and ETF performance.
In fact, the opposite has repeatedly been proven true with mutual funds, which have a long performance history to evaluate. Paying a [...])
- How Investment Securities Are Valued – Snapshots in Time (
Snapshots in time - How investment securities are valued
Every securities market transaction requires a buyer and seller with differing viewpoints.
Markets can operate, because there are differences between investors in their assessments of the intrinsic value and risk of securities.
Current investment values vary in the eyes of the many beholders of investment market securities. Knowledgeable participants [...])
- Avoiding Financial Advisor Frauds and Scams – Part 1 (
Part 1 of the The Never-Do List - 22 Good Ways to Avoid Financial Advisor and Investment Counselor Frauds and Scams
This article discusses things that you should “never do” with a financial planner or investment advisor, and it covers adviser selection, contracts, signatures, and ownership title of your assets.
You should never do certain things with [...])
Comments are closed.