Summary of Common Sense on Mutual Funds

New Imperatives for the Intelligent Investor

First Edition: 1999 more...

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Common Sense on Mutual Funds book summary
You can't beat the market with mutual funds – but you can still make money by investing in index funds.


8 Overall

9 Applicability

6 Innovation

8 Style

Recommendation believes that this classic work by one of the twentieth century’s great investment authorities belongs on every investor’s bookshelf. Published in 1999, at the height of a notorious stock market bubble, it was a rare, sage, clear-eyed appraisal of investment reality. It remains relevant. Author John C. Bogle argues so strenuously for a low-cost, passive investment approach based on index funds that you could almost accuse him of marketing hype. After all, he did start Vanguard, an investment company best known for its low-cost index funds. However, the evidence he presents to back up everything he says exonerates him fully. Today’s investors are not quite as eager as investors were in the 1990s to believe in the impossible dream of infinite wealth from the stock market. Still, many people waste their time and money trying to beat a market that the best financial research unequivocally shows is, for most people and over the long run, unbeatable. Bogle explains why, while recommending much-needed reform of the mutual fund industry.

In this summary, you will learn

  • Why index funds are the best approach to investing in mutual funds
  • Why understanding your personal tolerance for risk is important
  • What to consider when allocating your assets
  • Why the mutual fund industry needs reform


Revolutionary Common Sense
The Oxford English Dictionary defines common sense as "the endowment of natural intelligence possessed by rational beings...the plain wisdom which is every man’s inheritance...good, sound practical sense." Thomas Paine’s pamphlet series Common Sense...
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About the Author

John C. Bogle is founder and senior chairman of the Vanguard Group, Inc., the world’s largest no-load mutual fund group.

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