The Bogleheads' Guide to the Three-Fund Portfolio

Twenty benefits from the three-fund total market index portfolio.  The Bogleheads’ Guide to The Three-Fund Portfolio describes the most popular portfolio on the Bogleheads forum. This all-indexed portfolio contains over 15,000 worldwide securities, in just three easily-managed funds, that has outperformed the vast majority of both professional and amateur investors. If you are a new investor, or an experienced investor who wants to simplify and improve your portfolio, The Bogleheads’ Guide to The Three-Fund Portfolio is a short, easy-to-read guide to show you how.

Foreword by John C. Bogle xi Preface: the History of the Bogleheads’ Three-fund Portfolio xvii Acknowledgments xxv Chapter 1 The Investment Industry 1 Chapter 2 John C. Bogle—The Investor’s Best Friend 5 Chapter 3 John Bogle Introduces Three Total Market Index Funds 9 Chapter 4 Twenty Benefits of Total Market Index Funds (In No Particular Order) 13 Benefit 1: No Advisor Risk 14 Benefit 2: No Asset Bloat 17 Benefit 3: No Index Front Running 19 Benefit 4: No Fund Manager Risk 20 Benefit 5: No Individual Stock Risk 22 Benefit 6: No Overlap 24 Benefit 8: No Style Drift 26 Benefit 9: Low Tracking Error 27 Benefit 10: Above-Average Return 28 Benefit 11: Simplified Contributions and Withdrawals 32 Benefit 12: The Benefit of Consistency 33 Benefit 13: Low Turnover 34 Benefit 14: Low Costs 35 Benefit 15: Maximum Diversification (lower risk) 38 Benefit 16: Portfolio Efficiency (best risk/return ratio) 39 Benefit 17: Low Maintenance 40 Benefit 18: Easy to Rebalance 41 Benefit 19: Tax Efficiency 42 Benefit 20: Simplicity (for investors, caregivers, and heirs) 44 Chapter 5 Getting Started 49 Chapter 6 Stay the Course 59 Appendix I: What Experts S Ay 63 Appendix II: Meet the Bogleheads 69 Glossary of Financial Terms 75 Index 79