Smart Investing

So I borrowed this book from the library called The Smartest Investment Book You'll Ever Read by Daniel R. Solin. And I've been having lots of fun with it today. It's cool because I do know a bunch of things from school which allows me to skip around this book. He spends lots of time trying to convince you of the data behind what he's saying, but being that I've actually read the academic studies wigged out with all those formulas (even used them as a source in papers I wrote), I don't need no convincing. He doesn't outline them in this book, instead he refers to them plainly and it's a very easy read, even for people who have no idea what investing is about. It's only 152 pages or so (not including the appendix stuff, which isn't really necessary).

His main thesis is that you don't need a broker, because historically fund managers haven't done any better than randomly picking stock. Yes, it's true. Sure a manager can manage to "beat the market" for a few years straight, but the average overall return is usually no better...sometimes worse than the market.

So, I went ahead and bought my first ETF into my Roth, VTI (Vanguard Total Stock Market ETF). It's a really small purchase, considering my little bundle, but I got excited to really find out how it would work. I used to work in the Ops division of this securities firm and would process all these confirms for trades matching them with the ticket the trader filled out...it's kind of weird to know that somewhere out there, an employee is doing the same thing for my dinky trade (well, it was probably bundled up with others). Probably won't be trading again anytime soon though, because I realized it's not worth the trade commission until I've got more volume. I also busied myself comparing expense ratios of similar funds and ETFs in a spreadsheet. For anyone who's interested in knowing (I had fun ^_^):

Looks like Vanguard has the cheapest ETFs, and I ain't rich enough for the funds. Anyway, just thought I'd share!