Thanks to Allan Roth for recently joining the NGPF podcast. I got to know Allan a few years ago when I needed an advisor to help me “tune-up” my portfolio. I appreciated his candor, his analytical chops, his thoughts on asset allocation, his laser focus on fees and his willingness to challenge some of my assumptions. One of his best suggestions was that I create an investment policy statement which serves as a guide to my asset allocation during those turbulent market conditions that try mens’ (and womens’) souls. He wrote a provocative book that I recommend, How A Second Grader Beats Wall Street, which describes the simple strategies needed to be a successful investor (you will find out exactly who this wise second grader is during the podcast). Listen to this podcast and you’ll walk away with some ideas to make you a better investor. Enjoy!

Details:

  • 0:00~1:15 – Introduction
  • 1:15~2:43 – Earliest money lessons
  • 2:43~4:19 – First investment in the stock market
  • 4:19~5:18 – Passion for financial literacy
  • 5:18~6:37 – What does it mean to be a fee based advisor
  • 6:37~7:47 – Commission based versus fee based advisors
  • 7:47~9:02 – Why brokers can not beat the market
  • 9:02~10:11 – Odds of finding a good money manager
  • 10:11~11:19How a Second Grader Beats Wall Street 
  • 11:19~13:38 – The claw will take your money
  • 13:38~15:09 – How can an investor own the world?
  • 15:09~20:18 – Global diversification
  • 20:18~23:27 – Role of bonds in a portfolio as a shock absorber
  • 23:27~25:57 – What can be better than bonds (CDs)
  • 25:57~28:35 – Kramer versus Spongebob
  • 28:35~29:03 – A word from our sponsor, Next Gen Personal Finance
  • 29:03~34:28 – How Wall Street lies
  • 34:28~38:52 – Assessing risk profile
  • 38:52~41:38 – Buying stocks declining in price
  • 41:38~43:13 – The ‘KISS’ principle
  • 43:13~45:04 – Impact of taxes on a portfolio
  • 45:04~48:00 – Creating an investment policy contract
  • 48:00~49:42 – Parting thoughts
  • 49:42~50:25 – Conclusion
Resources:
Quotes:
  • “Investing is long term. It’s not about a game to see how much you can make buying three stocks and keeping it for twelve weeks”