THE BLOG
09/18/2009 05:12 am ET Updated Dec 06, 2017

The Missile You Never Saw Coming

Do my eyes deceive me? As of the close of business on August 14, 2009, a globally diversified portfolio, invested 100% in low cost stock index funds, was up over 25% YTD. Of course, that portfolio is too risky for most investors. What about a more prudent portfolio invested 60% in stock index funds and 40% in bond index funds?

That portfolio is up over 14% YTD.

Please check your returns. Comment below if your portfolio has matched these returns at the same level of risk.

Most of you read and watch the financial media. You have the benefit of advice from brokers and advisors, and all of the analytic resources of these financial experts. It is this advice that I refer to as "the missile you never saw coming."

To achieve the returns noted above, you really didn't have to do much. No stock picking or market timing. No calls to your broker or advisor. No need to wonder if Cramer's rants add or subtract value. No need to lie awake at night obsessing over "Dr. Doom's" latest apocalyptic predictions.

Just determine your level of risk and buy low cost index funds.

As I said in an earlier post, it's so easy your broker could do it.

But he won't and that is the subject of this week's video:

The views set forth in this blog are the opinions of the author alone and may not represent the views of any firm or entity with whom he is affiliated. The data, information, and content on this blog are for information, education, and non-commercial purposes only. Returns from index funds do not represent the performance of any investment advisory firm. The information on this blog does not involve the rendering of personalized investment advice and is limited to the dissemination of opinions on investing. No reader should construe these opinions as an offer of advisory services. Readers who require investment advice should retain the services of a competent investment professional. The information on this blog is not an offer to buy or sell, or a solicitation of any offer to buy or sell any securities or class of securities mentioned herein.

Dan Solin is the author of The Smartest Retirement Book You'll Ever Read.