Too Short for a Blog Post, Too Long for a Tweet 537

 

Here is an excerpt from a book I recently read, "The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns," by John Bogle.

Successful investing is about owning businesses and reaping the huge rewards provided by the dividends and earnings growth of our nation’s—and, for that matter, the world’s—corporations. The higher the level of their investment activity, the greater the cost of financial intermediation and taxes, the less the net return that shareholders—as a group, the owners of our businesses—receive. The lower the costs that investors as a group incur, the higher the rewards that they reap. So to enjoy the winning returns generated by businesses over the long term, the intelligent investor will reduce to the bare-bones minimum the costs of financial intermediation. That’s what common sense tells us. That’s what indexing is all about. And that’s the central message of this book.