Preface

Publisher's acknowledgements

Author's acnowledgements

Foreword

Introduction

I.1 What should I do with my money?

I.2 Ten eye-openers to get you thinking.

I.3 How this book will help you

I.4 How this book works

I.5 A few points to notes

Part 1: Smarter investing basics

Chapter 1: Simplifying the confusion

1.1 Choices, choices, choices

1.2 How did we get here?

1.3 Battling for investors’ money

1.4 Reducing confusion and complexity

Chapter 2: Covering the basics

2.1 What is smarter investing?

2.2 Ten points of focus for smarter investors

2.3 The two distinct phases of investing

2.4 There are no perfect answers

2.5 Summary: smarter investing basics

Chapter 3: It only takes a minute

3.1 Twenty tips for smarter investing

Part 2: Smarter thinking

Chapter 4: Get smart - find your philosophy

4.1 Without a smart investment philosophy you are lost

4.2 The foundations of your philosophy

4.3 The path to establishing your philosophy

4.4 Can active managers beat the markets after costs?

4.5 Do a few managers outperform consistently?

4.6 Can you identify them in advance?

4.7 Leading active managers endorse index investing

4.8 Summarising what you now know

4.9 In conclusion

4.10 A personal philosophy

4.11 Your investment philosophy rules

Anthony Bolton – The exception that proves the rule

Chapter 5: Get smart - have a word with yourself

5.1 You are your own worst enemy

5.2 Challenges to decision-making

5.3 Thirteen questions for you to answer – unlucky for some?

5.4 Ms. Rational versus Mr. Irrational

5.5 Wise words to leave you with

5.6 Behavioural rules and tips

Part 3: Building smarter portfolios

Chapter 6: Sorting out your goals

6.1 Well thought-out goals underpin success

6.2 Five steps in defining your goals

6.3 The nitty-gritty of basic financial survival goals

6.4 A working example

6.5 Useful calculations

6.6 Summary: investment goals

Chapter 7: Building a smart but simple portfolio

7.1 Choices, choices

7.2 The two key steps to building a portfolio

7.3 Understanding return and risk

7.4 Step 1: Picking a spot on the risk/return spectrum

Chapter 8: Equity and bond building blocks in brief

8.1 Equities in brief

8.2 Bonds in brief

8.3 Why use high-quality domestic bonds as market trauma protection?

8.4 By and large bonds help dampen market trauma

8.5 Summary: rationale for owning some bonds

Chapter 9.  Getting your equity/bond mix right

9.1 Focus on your end goal, not bumps in the road

9.2 Rules of thumb to decide your mix

9.3 Making an informed choice

9.4 A thirty-year investment horizon

9.5 A twenty-year investment horizon

9.6 A ten-year horizon

9.7 A five-year horizon

9.8 A ‘lifecycle’ approach to investing

9.9 Drawing an income from your portfolio

9.10 Finally, wise words from a highly respected investor

9.11 Summary: getting the mix right

Chapter 10: A portfolio for all seasons

10.1 Creating a diverse portfolio

10.2 A free lunch from Harry Markovitz

10.3 A practical framework for adding building blocks

10.4 A paragraph on each

10.5 Simple rules for constructing a portfolio

10.6 Possible portfolios

10.7 Summary of the portfolio construction process

Chapter 11. Fancy tools - getting technical

11.1 Using optimisation to define ‘efficient’ portfolios

11.2 Using probability-based models

11.3 Summary: getting technical

Part 4: Smarter implementation

Chapter 12. Six steps to a smarter portfolio

12.1 Step 1: Choosing your market benchmarks

12.2 Step 2: Decide on whether to go index or active

12.3 Step 3: Funds, separately managed accounts or brokers?

12.4 Step 4: Selecting the best index funds

12.5 Step 5: Administering your investments

12.6 Step 6: Portfolio maintenance

12.7 Market valuation levels and lump sum investing

12.8 Tip 1: Selecting the best active managers

12.9 Tip 2: Where to find information on indices

12.10 Tip 3: Where to find useful information on funds

12.11 Tip 4: Don’t forget about tax

12.12 Ten tips for smarter practical investing

Chapter 13: Costs – what a drag

13.1 Why do we throw our money away?

13.2 More than just management fees

13.3 Summary: costs – what a drag

Chapter 14. Standing firm on index funds

14.1 Common arguments used to put down index funds

14.2 Bond investing: active or index?

14.3 Summary: the active versus index debate

Part 5: Smarter building block insights

Chapter 15: The thrills and spills of equities

15.1 Why the thrills and spills?

15.2 The thrills of equity investing

15.3 The spills of equity investing

15.4 What about future equity returns?

15.5 Summary: the thrills and spills of equities

Chapter 16. The ins and outs of bonds

16.1 The ins and outs of bonds

16.2 Taking a closer look at bond returns

16.3 Bond markets crash too!

16.4 The outlook for bond returns

16.5 Summary: bonds

Chapter 17: Spotlight on return smoothers

17.1 Index-linked gilts a.k.a. ‘linkers’

17.2 Property – the misunderstood asset class

17.3 Hedge funds – are they all they are cracked up to be?

17.4 Commodities

17.5 International equities

Chapter 18: Spotlight on return enhancers

18.1 Smaller companies – higher returns?

18.2 Value and growth: what’s that all about?

18.3 Emerging market equities make sense in theory

Conclusion

Bibliography

Websites

Insightful books

Data-oriented books

Asset allocation software

Additional sources

Index