John C. Bogle is the retired founder and CEO of Vanguard and the Vanguard Mutual Fund Group. This book is the third volume of the “little book series”. Which tells the best specific investment policies. And we also say, this is the Bogle philosophy. Which means the smartest investment for most stock market investors is the broad, low-fee index fund. Let's do a short review of this book and know what BOGLE should write under the red cover. This book is based on eighteen chapters and each chapter should contain ten to twenty pages. The point of this book is that you should invest in low-cost index funds. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an Original Essay The brief review of this chapter is enough to define that many chapters focus on retelling the classic Warner Buffet story of gorocks and sidekicks. Simply put, what people have to pay for choosing to invest wisely is that they actually take money away from you rather than making more of it. The moral is, in Buffett's words, that for investors as a whole, returns decrease as movement increases. An effective investor invests through the intermediary method, where the intermediary charges a minimum for their services. From Gotrocks' fable in chapter 1, Bogle tries to apply the lesson of the story to the title. Over the long term, he compares the company's investment return to the stock investment return and believes the correlation is very close. What do you mean? In the long run, investment in company shares is consistent with the success of the company itself. There may be short-term twists in investor emotions, but when you buy stocks for the long term, you are buying the underlying business. Therefore, short-term stock investing is a very different game than long-term investing, and we recognize that we do not understand the investor emotions required to play a short-term game. Here, Bogle breaks out Ockham's razor (law of parsimony). Fundamentally speaking all things are equal. The simplest solution is the best trend. From that point he talks about the general investment strategy of investing in a very broad stock (e.g. S&P 500) that corresponds to overall long-term stock market success. Next, we compare the S&P 500 to major company funds and find that the S&P 500 has outperformed the average of large other company funds in 26 years of the last 35 years. Why? Bogle actually responds in the next chapter of this chapter by stating that the stock market is a zero-sum game. For all the stocks that beat the market, there are stocks that won't beat the market. Their sum corresponds to the market. For the average investor in the market, half of the stocks chosen break the market, the other half do not beat the market, on average compared to market value. But this is before the commission. If you add a fee, the average investor will not beat the market. The return on investment is lower than the market, which is practically lower when fees are high. If the market returns 8% and pays 2.5% commission, your return will actually only be 5.5%. You may have some money in your savings account. This chapter goes in a new direction, and emotions often point to it being the cause of further weakness in investor returns. Investors tend to buy into the stock market as the stock market rises, excluding most of the profits.Here's an example. Let's say the stock market is at 10,000 at the beginning of 2010. At the beginning of 2011, the stock market is up to 11,000, with a profit of 10%. People will decide to buy after seeing the stock market rise and it will continue to rise and attract new investors. In 2013 the market peaked at 13,000, reaching 11,500 in early 2014. The average of people sitting quietly and silently averaged about 4% per year, while those who only bought a yearin followed earn only 2% each year. Another challenge for equity investors is the taxes covered in Chapter 6. In a word, aggressively managed mutual funds take up annually, according to the law, a percentage of the realized capital gains and dividend income, which is terrible from a fiscal point of view. point of view - why you need to pay dividends on a regular basis. This is an aggressively managed fund which means selling a lot of shares throughout the year and making substantial profits and paying 90% of the profits to the fund holders. Because index funds have very little active management, in most cases they will pay little at distribution, so taxes rarely apply. Therefore, compared to aggressively managed mutual funds, index funds are much better than fees. Here, in this document, as we mentioned at the beginning of the chapter in most cases, we observe that this moment is widely considered, we see that the payback period is short. During these times, the actual return of managed mutual funds will reach 0% much faster than index funds intend. In other words, intentions with long-term index funds that lose money with managed funds. It's easy to find out when Index Fund loses money and when a particular managed fund has made a profit, but this is a huge anomaly due to factors that depend on it. This chapter mainly shows the performance of managed mutual funds for 35 years. Over these 35 years, less than 1% of the fund has actually broken the market more than 2% per year, and survived the growth of investors along with it. Over the next 35 years these funds may repeat business results due to changes in fund manager sales and market trends. In other words, long-term managed funds rarely beat almost any stock market. Clearly, some funds should take advantage of boom periods in certain areas rather than other funds. For example, some funds did a great job dominating the market in 1998 and 1999 by capitalizing on the dot com boom of the late 1990s. What happened to the fund? Almost universally, between 2000 and 2002, there was an incredibly huge crash that far exceeded the overall market recession. Even if averaged, we get much worse results than the market itself. If you are interested in doing a short dance, you can earn money this way, but investing in some areas is not a healthy situation in the long run. This chapter mainly shows whether you should spend money on an investment advisor or not. And the chapter says, “No.” In fact, most advisors are far worse than the market when commission is calculated. Instead, we encourage you to invest directly with cash in the index fund. Don't worry. For me, this is already what I'm doing and I couldn't be happier about it. From here, I will talk about how to choose your own funds, but the amount of funds is huge and it is quite a lot of work. How do I remove funds? The first thing you should do?.