I RECENTLY FINISHED reading the second edition of William Bernstein’s The Four Pillars of Investing—twice. This new edition is a significant rewrite of the first edition that was published in 2002. Even if you’ve read the first edition, reading the second edition is worth your time.
Though I’ve read most of the books written by well-known investment luminaries familiar to HumbleDollar readers, there were still pearls of wisdom I gathered from this second edition.

HOW DO YOU COMPETE in an investment contest when you’re a firm believer that investors can’t consistently beat the market averages? That was my dilemma several years ago.
A school not far from where I taught was given money by an alumnus to endow the St. Louis Area Collegiate Investment Contest. All colleges and universities in the area are invited to participate in the competition, which is held regularly. Each is given a hypothetical $1 million and asked to select 20 value stocks.

WHEN I WAS NINE years old, I managed a diversified portfolio—and yet I knew nothing of stocks and bonds. My primary asset classes matched those of my peers: coins, baseball cards and stamps.
Rather than a brokerage firm, we had the Koin Korner, a fairly large store in our nearby shopping mall that sold coins, stamps and a few other collectibles. And instead of following the gyrations of the stock market in The Wall Street Journal,

A KEY CONUNDRUM FOR investors: On the one hand, the data on tactical trading are clear. Frequent portfolio shifts are a bad idea and can damage returns. On the other hand, we shouldn’t be so wedded to the status quo that we’re unwilling to ever make a change.
With this conundrum in mind, it was notable when investor and author Howard Marks declared a “sea change” in the investment landscape and recommended that investors revamp their portfolios.

WHAT’S THE BIGGEST threat to your retirement?

For young adults, we know a key pitfall is failing to invest in stocks because they’re so afraid of the market’s short-term ups and downs, thus unwittingly risking impoverishment later in life.

But for those of us nearing retirement, the market’s ups and downs can start to matter more than stocks’ long-term inflation-beating performance. An ill-timed market crash or a run of bad annual returns could ruin our retirement plans.

DON’T LOOK NOW, but value is beating growth—just not here in the U.S.

From May 31 through Sept. 29, iShares MSCI EAFE Value ETF (symbol: EFV), which invests in developed foreign markets, is up 5.6%, while iShares MSCI EAFE Growth ETF (EFG) is down 6.5%. That brings the year-to-date performance of the two funds to 9.6% for the iShares value fund and 4% for the iShares growth fund. Meanwhile, the style-neutral iShares MSCI EAFE ETF (EFA) is up 6.9% in 2023.

AS THE SAYING GOES, a picture is worth a thousand words. Over the years, I’ve found certain images and illustrations to be immensely helpful in discussing investment concepts. These are the ones I’ve relied on the most:
Only in Australia. A key challenge for investors—if not the key challenge—is that none of us has a crystal ball. It’s impossible to know what markets will do next month or next year.

ACCORDING TO THE consensus of HumbleDollar’s thoughtful and learned readers and contributors, I’m making a mistake by actively managing my investments instead of passively investing in index funds. In an earlier piece, I touched briefly on my reasons for doing so. It’s simple. I do it because I like to do it.
After the past few months, when my investments have definitely lagged the averages, I’ve decided to revisit my decision. What I write here is in no way intended to influence anyone else’s decision.

I ONCE DREAMED OF writing for one of the high-profile personal finance magazines—but that was before I had a rude awakening about the “journalism” they sometimes committed.
As a mid-career business journalist at a respectable daily newspaper, teaching myself about investing, I had looked up to these magazines, then in their heyday, and viewed them as a career possibility.
My worlds came together one day when a top magazine ran a story touting the stock of the electric utility that served my area.

FROM AN EARLY AGE, whenever I heard the word “stock,” it was said with a derisive tone. My father hadn’t owned any shares, but the 1929 stock market crash and Great Depression still hit him hard. He wasn’t able to find steady work until after the 1941 attack on Pearl Harbor.
Given its effect on our family, my father had a pathological disdain for the market that was, inadvertently, passed on to me. Without being aware of it,

BACK IN THE 1980s, Michael Milken earned notoriety as “the junk bond king.” With his swagger—and his toupee—Milken was an outsized personality in a normally staid industry. But that was four decades ago. It may have been the last time that bonds were truly interesting.
On most days, bonds are about as dull a topic in finance as you can find. But here’s the challenge for investors: While bonds might be boring, they’re important—and they can be tricky.

I’M NOT A MARKET addict. How can I be so sure? Because, on many occasions, I’ve been able to stop myself from trading excessively. Still, in July, the stars aligned to make me susceptible to another relapse.
A reluctant traveler at best, I was persuaded to accompany my wife Alberta to a 14-day writers’ conference in Upstate New York. I’m a confirmed introvert, so I groove on alone time. But 10 hours every day—while Alberta attended the conference—proved to be a challenge.

EVERY DAY, I READ about the Federal Reserve’s thinking on interest rates—increase, hold, decrease—and the possible impact on the economy. But what about the impact on savers?
As someone who has most of his non-stock monies invested in taxable certificates of deposit, high-yield savings accounts and money market funds, I have a different criterion for the right interest rate: It’s the rate that would give me and other risk-averse savers a modest real return of perhaps 1% a year,

MY FATHER RAISED ME to think that, if I set my mind to it, I could do just about anything. He said that concentrated focus and drive would allow me to reach my dreams, and that there was rarely a time when I should settle for average.
Maybe it’s no great surprise, then, that I hate being average. I’m above average in smarts, the kind that gets you a side order of noogies as a second grader.

MY FATHER WAS president of J.S. Collins and Son, a local hardware and lumber chain in southern New Jersey. Occasionally, he’d take me to the flagship location in Moorestown after hours. While he was back in his office doing important business, I wandered around the empty store and general office areas. At 10 years old, it was easy to get bored.
One day, I got the idea to pull out an empty drawer from one of the office desks.