Today, I decided on my forum "signature." I chose "The Majesty of Simplicity." Here's why:
My library contains 34 binders from "Annuities" to "Vanguard" containing the best articles I have saved about successful investing. For my personal forum "signature" I choose "Simplicity" because it is a proven pathway to successful investing and recommended by our mentor, Jack Bogle. "Simplicity" is also a counter-balance to our many discussions using complex portfolios and esoteric techniques promising to "beat the market."
I have read hundred's of investing books (co-authored two of my own) and thousands of articles about investing. I hold a Morningstar record of more than 25,000 posts. The more I learn, the more I understand "The Majesty of Simplicity." Others, who know more than I do, agree:
Scott Adams, author of Dilbert: "I once tried to write a book about personal investing. - After extensive research I realized I could describe everything that a young first-time investor needs to know on one page."
Christine Benz, Morningstar Director of Personal Finance: "Simplicity is one of the greatest--but in my view, woefully underrated--virtues when managing a portfolio."
Bill Bernstein, author of Four Pillars of Investing: ""The more real people I get to know, the more I am convinced the simpler the solution, the better the solution."
Richard Bernstein, Merrill Lynch strategist: "Investors find it hard to believe that ignoring the vast majority of investment noise might actually improve their performance."
Jack Bogle, Vanguard founder: "Simplicity is the master key to financial success."
Jack Brennan, Vanguard CEO and author of Straight Talk on Investing: "It's in the interest of many financial service companies to make you think that investing is difficult.--It's really quite simple."
Warren Buffet: "To invest successfully, you need not understand beta, efficient markets, modern portfolio theory, option pricing or emerging markets. You may, in fact, be better off knowing nothing of these."
Scott Burns, financial author and creator of The Couch Potato Strategy: "Concentrate on a simple portfolio with two basic assets--a stock index fund and a bond index fund. Do that and you'll enjoy superior performance with less risk."
Andrew Clarke, author of "Wealth of Experience": "In investing, simple is usually more productive than complex."
Jonathan Clements, Wall Street Journal columnist: "Investing is simple. To be sure, you can make it ludicrously complicated."
Paul Crafter, author of "Investment Guide": "After doing it all, I now feel I've come around in a complete circle, ending up with this: The more I learn, the less I really need to know."
Laura Dogu, co-auther of "The Bogleheads Guide to Retirement Planning": A simple portfolio is actually the ultimate in sophistication. It almost always lowers cost (including taxes), makes analysis easier, simplifies rebalancing, simplifies tax-preparation, reduces paper-work and record-keeping, and enables caregivers and heirs to easily take-over the portfolio when necessary. Best of all, a simple portfolio allows the investor to spend more time with family and friends."
Michael Edesess, author of The Big Invesment Lie: "As a mathematician I know when mathematical-sounding analyses are little more than elaborate sales pitches, designed to thoroughly obscure the simple fact that smart investing is non-mathematical and accessible to everyone."
Albert Einstein: "The five ascending levels of intellect are: smart, intelligent, brilliant, genius, simple."
Charles Ellis, co-author of "The Elements of Investing": "KISS investing--Keep It Simple, Sweetheart--is the best and easiest and lowest cost and worry-free way to invest for retirement security."
Paul Farrell, author of "The Lazy Person's Guide to Investing": "Perhaps the most amazing insight I got out of this review of the investment habits of Nobel laureates is the simplicity of their investing strategies."
Rick Ferri, CFA, author of "All About Index Funds": "It does not take much to outperform the average investor. All you have to do is put half your money in the Vanguard Total Stock Market and the other half in an intermediate-term bond index fund. Then rebalance your account once per year. By keeping it simple, you will achieve all the benefits the markets have to offer."
Future Metrics looked at the performance of 224 pension plans over about 14 years compared with the performance of 60% S&P 500 index and 40% aggregate bond index benchmark. Of those 224 plans, only 19 beat that simple benchmark.
Gensler & Baer, authors of "The Great Mutual Fund Trap": "If you simply buy and hold you don't need to read investing magazines, watch financial news networks, subscribe to newsletters, or pay a broker to execute new trades."
Benjamin Graham: "In the stock market, the more elaborate and abstruse the mathematics, the more uncertain and speculative are the conclusions we draw therefrom."
Alan Greenspan, former chairman of the Federal Reserve: "This decade is strewn with examples of bright people who thought they built a better mousetrap that could consistently extract abnormal returns from financial markets. Some succeed for a time. But while there may occasionally be misconfigurations among market prices that allow abnormal returns, they do not persist."
Daniel Kahneman, Nobel Laureate: "All of us would be better investors if we just made fewer decisions"
Edmund Kean: "Complexity is easy. Simplicity is hard."
Michael LeBoeuf, author of "The Millionaire in You": "The master key to wealth can be summed up in just one word: Simplicity."
Leonardo da Vinci: “Simplicity is the ultimate sophistication.”
Peter Lynch, "Magellan Fund" manager: "If you spend more than fifteen minutes a year worrying about the market, you've wasted twelve minutes."
MIT study: "The less well-informed group did far better than the group that was given all the financial news."
Joe Maglia, CEO TD Ameritrade: "Wall Street goes out of its way to make investing incredibly sophisticated and complex because they can make a tremendous amount of money by doing so."
Burton Malkiel, author of "Random Walk Down Wall Street": "The overarching rule for achieving financial security: Keep it simple."
John Markese, CEO of American Association of Individual Investors: "If you have more than eight funds you should slap yourself."
Wm McNabb, Vanguard CEO: "If you can't understand an investment product in five minutes, walk away."
Eric McWhinnie, chief analyst, Wall Street Cheat Sheet: "Keep your investment strategy simple and steer clear of complicated vehicles that are designed to benefit the people selling them."
James Montier, author: "Never underestimate the value of doing nothing."
Morningstar Guide to Mutual Funds: "Good investing doesn't have to be complicated. In fact, simplification may lead to better investment results."
Suze Orman: "We make investing so complicated and it really is not. -- A total market index fund is a great one-stop-shopping choice that provides you instant diversification among different types of stocks."
Mike Piper, financial author: "There's an entire industry built on convincing us that investing is complicated."
Jane Bryant Quinn, syndicated columnist and author of "Smart and Simple Financial Strategies": "You shouldn't buy anything too complex to explain to the average 12-year old."
John Rekenthaler, Morningstar Research Director: "How many funds should you have? Four to six should do."
Rodc on Boglehead Forum: "While doing this financial engineering my wife who does no math just shook her head at my optimization games and said, 'Rod, life is uncertain, get over it.' After a lot of work I discovered much to my surprise, she was right."
Paul Samuelson, Nobel Laureate: "Investing should be like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas."
Bill Schulthies, author of "The Coffeehouse Investor": "When you simplify your investment decisions, not only do you enrich your life by spending more time on families, friends and careers, but you enhance portfolio returns in the process."
Chandon Sengupta, author of "The Only Proven Road to Investment Success": "There is overwhelming evidence that the simplest possible investment method works much better than all the other more complex ones."
Jack Sim: "The culture of consumerism: Buying things you don't need, with money you don't have, to impress people you don't like."
Larry Swedroe, author of "The Successful Investor Today": "The more complex the investment, the faster you should run away."
David Swensen, Yale Chief Investment Officer: "As a general rule of thumb, the more complexity that exists in a Wall Street creation, the faster and farther investors should run."
Andrew Tobias, author of The Only Investment Guide You Will Ever Need: "I believe in selecting the most straightforward and easiest-to-implement strategy for achieving our goals."
Tweddell and Pierce, authors of "Winning with Index Mutual Funds": "Keep it simple. Investment success depends on asset allocation, diversification, and risk management, not on complexity."
Eric Tyson, author of "Mutual Funds for Dummies:" "Planners may try to make it all so complicated that you believe you can't possibly manage your finances or make major financial decisions without them."
Walter Updegrave, editor of MONEY magazine: "Simpler is better. Ignore the siren song of sophisticated investments"
Richard Young, author of "The Intelligence Report": "If you can't run your portfolio taking 60 minutes a month, it's too complicated."
Jason Zweig, Wall Street Journal columnist and author of "The Intelligent Investor": "The less you fool with your portfolio, the less often you'll play the fool."
Warren Buffett: "There seems to be some perverse human characteristic that likes to make easy things difficult."