John Bogle commonly referred to as “Jack” was born on May 8th 1929, he was an American investor, businessman and Philanthropist. He was the founder and chief executive of the famous American registered investment advisor – The Vanguard Group. Read the full blog to know about the 5 investments lessons from Jack Bogle
Jack was an avid investor and preached investments over speculations (trading), long term over the short term. He also created the first index funds.
Today let’s discuss the 5 investments given by him to his fellow investors and followers.
1. While investing keep emotions at bay:
- He used to believe that “Impulse is your enemy” and no investor should allow emotions to come into the picture while investing. He quotes “Eliminate emotion from your investment program.
- Have rational expectations for future returns and avoid changing those expectations in response to the ephemeral noise coming from Wall Street.”
2. Stick to your own investment Plan:
- Bogle advised his investors that they need to “Stay the Course” even at the most challenging times. Changing your strategy at the last moment can be more devastating.
- “Wise investors won’t try to outsmart the market,” he says. “They’ll buy index funds for the long term, and they’ll diversify.”
3. Stay away from the experts:
- He believes if money managers can miss the signs of the 2008 financial crisis then, in that case, stays away from them.
- His famous quote “How could so many highly skilled, highly paid securities analysts and researchers have failed to question the toxic-filled, leveraged balance sheets of Citigroup and other leading banks and investment banks?“
4. Don’t overspend, keep the cost down:
- He says “In investing, you get what you don’t pay for. Costs matter. So intelligent investors will use low-cost index funds to build a diversified portfolio of stocks & bonds.
- And, they will stay the course. And they won’t be foolish enough to think that they can consistently outsmart the market.“
5. Own the entire stock market:
- John Bogle was the leading proponent of structuring an investment portfolio, to mirror the performance of a market yardstick, like the S&P 500 stock index.
- Though every retail investor won’t totally agree with all his investment lessons, when followed in the right manner can help them to create a huge wealth in the long term.
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