The name of this new book by Larry Swedroe and Jared Kizer is long: The Only Guide to Alternative Investments You’ll Ever Need. It’s part of The Only Guide to … You’ll Ever Need trilogy. The other books in the same series have equally long names: The Only Guide to a Winning Investment Strategy You’ll Ever Need by Larry Swedroe and The Only Guide to a Winning Bond Strategy You’ll Ever Need by Larry Swedroe and Joseph Hempen.
The lead author Larry Swedroe is a principal of Buckingham Asset Management, an investment advisory firm in St. Louis, MO. He frequently posts on the Bogleheads forum, of which I’m the #6 registered user.
This book covers alternative investments, which are defined as investments outside of stocks, investment-grade bonds, and bank CDs. It puts 20 investments into four buckets: the good (6); the flawed (8); the bad (3); and the ugly (3). According to the authors, the good alternative investments are:
- real estate
- inflation-protected securities
- international equities
- fixed annuities
- stable-value funds
Take look at the table of contents and see where the rest belong. I’m happy to see that I own five of the six good alternative investments and none of the flawed, bad, or ugly ones.
For each investment, the authors explained what make it good, flawed, bad or ugly, from many different angles, including return, risk, correlation with other assets in a portfolio, expenses, tax efficiency, liquidity, among others. They cited many academic studies to back up their evaluation. For the good investments, the book also recommends specific vehicles for implementation. In case the reader is not familiar with some of the terms, there is a glossary at the end of the book. In under 300 pages, the authors covered a lot of materials. There is hardly any fluff.
Because it deals with alternative investments, this book is not for beginner investors, who should first focus on the core asset classes of stocks and bonds. It assumes a level of knowledge best obtained from reading The Intelligent Asset Allocator by William Bernstein. For beginner investors, I have several other books on my Recommended Reading List.
Rating: ***** (Excellent). Placed on the Recommended Reading List in the Advanced category.
Reviews by other bloggers:
Say No To Management Fees
If an advisor is charging you a percentage of your assets, you are paying 5-10x too much. Learn how to find an independent advisor, pay for advice, and only the advice: Find Advice-Only.