Re: help me decide what to do with my money
 

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You don't want mutual funds, you want index funds [though technically, an index fund is a type of mutual fund].

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If you read my post, I recommended Total Stock Market, and Total International. Both are index funds. They are also mutual funds.

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My comment wasn't directed at you. It's for OP because when I first learned about the market, the words confused me.

On another note, I highly recommend HSBC.

Re: help me decide what to do with my money
 

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Vanguard is ok. Personally I use an online broker and www.ishares.com funds, even less menagement fee's. All of this is a whole lot better than keeping money in your safe at the Bellagio heh


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Just want to let OP know that you can buy ETF through discount online broker(i.e. scottrade/ameritrade..etc for a low fee or even free with zecco) That fee would typically be lower than the fee mutual funds charge you to buy their fund index. (not too sure if it is waived if you put in a lot of money)


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The Intelligent Investor
Rich Dad Poor Dad
A Random Walk Down Wall Street
Reminiscences of a Stock Operator
The Millionaire Next Door
Fooled By Randomness
The Black Swan
How to Make Money in Stocks


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Blue, which books would you recommend reading first for complete beginners?

Re: help me decide what to do with my money
 

Thanks for all the help so far. What I am understanding is that I need to invest in a bunch of index funds, as listed in the link Newt posted. If this is incorrect let me know. Thanks for the info.

Re: help me decide what to do with my money
 

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The Intelligent Investor
Rich Dad Poor Dad
A Random Walk Down Wall Street
Reminiscences of a Stock Operator
The Millionaire Next Door
Fooled By Randomness
The Black Swan
How to Make Money in Stocks



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Blue, which books would you recommend reading first for complete beginners?

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i would go in this order..

-reminiscences of a stock operator (only because its so awesome)
-rich dad poor dad (just to learn basic stuff)
-the intelligent investor (long considered one of best investment books ever written)
-how to make money in stocks (i never hear much about this but i thought it was great it has everything u need to know about investing in stocks)
-fooled by randomness (just an overall fun read. i think taleb is a lil full of himself, but i still liked it)
-the millionaire next door (i didnt think this book was anything special. i read it and the millionaire mind and was just kinda bored. didnt learn a whole lot.)

and.. i havent read the black swan or a random walk down wall street, but i hear good things and they are on my to do list. just my 2 cents.

Post deleted by Mat Sklansky
 

Re: help me decide what to do with my money
 

The Richest Man in Babylon is a simple and leisurely read to get pumped about investing and to change your friends' poor spending habits.

Once you read all of the books above, I highly recommend reading all of the greats' books: almost all of Warren Buffett's writings, Lynch's two books, everything you can about Soros, etc. etc. Their different yet extremely successful philosophies and insights are fascinating to read about.

http://invest-faq.com/bookshelf.html has a good list of books I use from time to time.

Re: help me decide what to do with my money
 

It's much harder than it seems for a financial advisor to add value (alpha) to your account. Outperforming the market is very tough to do when you are paying someone between 1-2% to manage your money. As an amateur investor the first thing you should learn is the fee structure of various investing vehicles. All mutual funds or ETFs make money somehow by charging you, so figure out how it works. Don't really look at annualized returns because they are just a function of the risk exposure of a fund.

Portfolio theory involves having a well diversified collection of assets. In the past few months, this theory has gone to [censored] because many investment vehicles thought to be well-correlated weren't so correlated (equity market went down, bond yields down, gold prices down, etc).

Increase your EV by getting broad exposure to the market while paying as little as you can in fees.

If you need the money in the next year, I'd suggest just using ING and getting 5% or whatever.

Re: help me decide what to do with my money
 

Again, thank you for all the info. If all I have to do to make 10% is to just put it in a bunch of index funds, why do I need to read all the books? Are they just there if I want to become a day trader or whatever? Also Jason, you say not to look at the annual return. If that is the case, what should I be looking at when deciding where to put my money?

Re: help me decide what to do with my money
 

The purpose of financial advisors is not to add alpha. You pay them to keep up to date with stock knowledge, manage your risk, possibly give you access to DFA funds, and manage your portfolio for you. Many also help you out with taxes.

Re: help me decide what to do with my money
 

To add to blueman's book list, I'm reading The Essential BUffett and finding it illuminating (I'm a total noob at this stuff as well).