[Book] The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns

The best-selling investing “bible” offers new information, new insights, and new perspectives

The Little Book of Common Sense Investing is the classic guide to getting smart about the market. Legendary mutual fund pioneer John C. Bogle reveals his key to getting more out of investing: low-cost index funds. Bogle describes the simplest and most effective investment strategy for building wealth over the long term: buy and hold, at very low cost, a mutual fund that tracks a broad stock market Index such as the S&P 500.

While the stock market has tumbled and then soared since the first edition of Little Book of Common Sense was published in April 2007, Bogle’s investment principles have endured and served investors well. This tenth anniversary edition includes updated data and new information but maintains the same long-term perspective as in its predecessor. 

Bogle has also added two new chapters designed to provide further guidance to investors: one on asset allocation, the other on retirement investing.

A portfolio focused on index funds is the only investment that effectively guarantees your fair share of stock market returns. This strategy is favored by Warren Buffett, who said this about Bogle: “If a statue is ever erected to honor the person who has done the most for American investors, the hands-down choice should be Jack Bogle. For decades, Jack has urged investors to invest in ultra-low-cost index funds. Today, however, he has the satisfaction of knowing that he helped millions of investors realize far better returns on their savings than they otherwise would have earned. He is a hero to them and to me.”

Bogle shows you how to make index investing work for you and help you achieve your financial goals, and finds support from some of the world’s best financial minds: not only Warren Buffett, but Benjamin Graham, Paul Samuelson, Burton Malkiel, Yale’s David Swensen, Cliff Asness of AQR, and many others.

This new edition of The Little Book of Common Sense Investing offers you the same solid strategy as its predecessor for building your financial future.

  • Build a broadly diversified, low-cost portfolio without the risks of individual stocks, manager selection, or sector rotation.
  • Forget the fads and marketing hype, and focus on what works in the real world.
  • Understand that stock returns are generated by three sources (dividend yield, earnings growth, and change in market valuation) in order to establish rational expectations for stock returns over the coming decade.
  • Recognize that in the long run, business reality trumps market expectations.
  • Learn how to harness the magic of compounding returns while avoiding the tyranny of compounding costs.

While index investing allows you to sit back and let the market do the work for you, too many investors trade frantically, turning a winner’s game into a loser’s game. The Little Book of Common Sense Investing is a solid guidebook to your financial future.

The key lessons that readers can learn

Here are some of the key lessons that readers can learn from “The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns” by John C. Bogle:

  1. The best way to invest is through low-cost index funds that track the entire market.
  2. Active investing and trying to beat the market is a loser’s game, as the fees and expenses associated with it eat away at your returns.
  3. Investing is a long-term game, and it’s important to have patience and discipline to stay invested through market ups and downs.
  4. Diversification is key to managing risk in your portfolio, and it’s important to hold a mix of asset classes, including stocks, bonds, and cash.
  5. Investors should focus on the long-term and not get distracted by short-term market fluctuations or news events.
  6. It’s important to have a plan and stick to it, avoiding the temptation to make frequent trades or changes to your portfolio.
  7. By avoiding high fees and expenses and taking a long-term approach, investors can capture the full returns of the market and achieve their financial goals.

Overall, the book teaches readers the importance of taking a simple, straightforward approach to investing and avoiding the common pitfalls that can lead to subpar returns.

From the Back Cover

Praise for the little book of common sense investing

  • “Jack Bogle’s remarkable career spans the spectrum from lonely iconoclast to celebrated rock star. His conception and development of index funds transformed the investment world for individuals and institutions alike. Countless millions of investors have purchased index funds because of Jack. But, simply being an indexer is insufficient. Successful investors embrace the principles undergirding the rationale for index funds and understand the pitfalls hindering the effective execution of an investment plan. The Little Book of Common Sense Investing provides the tools required to implement a winning portfolio strategy. Read it and win!” —DAVID F. SWENSEN, Chief Investment Officer, Yale University
  • “What Gutenberg was to the printing press, Henry Ford to the automobile, and Shakespeare to the English language, Jack Bogle is to finance. The Little Book of Common Sense Investing packs into 270 short pages the distilled genius of the nearly seven decades he’s spent revolutionizing the process for everyone, from the smallest IRA holder to the largest pension and endowment funds. Read, enjoy, and profit.” —WILLIAM J. BERNSTEIN, bestselling author of The Investor’s Manifesto: Preparing for Prosperity, Armageddon, and Everything in Between
  • “One hundred years from today, historians will remember only two investors from this era—Warren Buffett and Jack Bogle. The two books they will note? Buffett’s bible, Ben Graham’s The Intelligent Investor, and . . . anything written by Jack Bogle. In a world of investment foxes, Jack remains a stalwart hedgehog. The Little Book of Common Sense Investing, updated here, will prove timeless as it thoughtfully articulates Bogle’s one big idea—how investors can get their fair share of market returns.” —STEVE GALBRAITH, Managing Member, Kindred Capital
  • “Jack Bogle’s thin Little Book is thick with wisdom. It’s informative, insightful, and opinionated— with the added advantage of being correct! As Bogle explains, the road to investment failure is paved with expensive advice, expensive investments, and expensive advertising (urging you to buy the first two). Bogle suggests a very different course for investors, virtually guaranteeing investment success.” —TED ARONSON, CFA, founder, AJO

Popular Highlights in this book

  • The expectations market is about speculation. The real market is about investing. The stock market, then, is a giant distraction to the business of investing.
  • The message is clear: In the long run, stock returns depend almost entirely on the reality of the investment returns earned by our corporations.
  • Where returns are concerned, time is your friend. But where costs are concerned, time is your enemy.
  • Warren Buffett puts the moral of his story this way: For investors as a whole, returns decrease as motion increases.
  • The true investor . . . will do better if he forgets about the stock market and pays attention to his dividend returns and to the operating results of his companies.

Review book

The Little Book of Common Sense Investing” by John C. Bogle has received widespread praise from professionals in the financial industry for its clear and concise explanation of the benefits of low-cost index fund investing.

Bogle, the founder of the investment management company Vanguard, is widely regarded as one of the most influential figures in the investment world, and his book reflects his decades of experience and research in the industry.

Financial experts have praised the book for its practical advice and emphasis on the importance of long-term investing strategies. They also appreciate Bogle’s straightforward and easy-to-understand writing style, which makes complex investment concepts accessible to readers of all levels of experience.

Overall, “The Little Book of Common Sense Investing” is widely regarded as a must-read for anyone interested in investing and is considered a classic in the field of personal finance.

Global ratings

As of February 2023, “The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns” by John C. Bogle has a 4.3-star rating on Amazon with over 1,800 reviews and than 8,000 ratings. On Goodreads, the book has a rating of 4.2 stars out of 5, based on more than 18,000 ratings and over 1,000 reviews. The book has been widely praised for its clear and concise explanation of the principles of index investing and its strong advocacy for low-cost, passive investing. Readers appreciate Bogle’s no-nonsense approach to investing and his emphasis on long-term thinking and disciplined investment strategies. Many reviewers note that the book is a must-read for anyone looking to improve their understanding of the stock market and build a successful investment portfolio.

Product details

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