Book Gone Fishin’ Portfolio - Alexander Green
Retire Richly. Financial Independence. Gone Fishin' Portfolio. Alexander Green. Map with stock indices
In a world saturated with complex financial advice and a constant barrage of market news, "The Gone Fishin' Portfolio" by Alexander Green offers a refreshing perspective for financial independence by advocating for a simple, low-maintenance investment strategy based on index funds and passive ETFs. Many individuals, including those financially independent, feel overwhelmed by the intricacies of the financial markets and the pressure to constantly monitor their investment portfolio. Green strives to demystify investing and provide a clear, actionable plan for ordinary people to become financially independent over the long term without requiring extensive financial knowledge. That the first edition was a bestseller suggests a significant demand for this type of simplified and effective investment guidance. It may be aid financial planning towards early retirement.
BOOKS BY ALEXANDER GREEN - AUTHOR OF GONE FISHIN’ PORTFOLIO
“Your overriding goal is to achieve and maintain financial independence”
“Manage your own money”
GONE FISHIN’ PORTFOLIO ADVOCATES FOR SELF-DIRECTED PORTFOLIO WITH LONG-TERM ASSET ALLOCATION
Take control of your finances through self-management and low costs. The book strongly advocates for individuals to manage their own money rather than relying on expensive Wall Street advisors. It argues that lower costs lead to higher returns over the long term. By investing in low-fee options like Vanguard index funds or ETFs, individuals can significantly reduce expenses that would otherwise eat into their returns. The author contends that most investors don't need to pay for financial advice that often underperforms simple, low-cost strategies.
Prioritize strategic asset allocation over market timing or individual stock picking. The book emphasizes that asset allocation accounts for the vast majority of a portfolio's total return. This involves strategically dividing investments among different asset classes like U.S. stocks, foreign stocks, bonds, REITs, and gold shares. The Gone Fishin' Portfolio model provides a specific asset allocation as a straightforward plan. The book advises against trying to time the market, as even experts struggle with consistent prediction.
Adopt a long-term mindset with patience and discipline for financial success. The book highlights the importance of a long-term investment horizon and the power of compounding. It stresses that patience and discipline are key to weathering market fluctuations and sticking to a chosen strategy. Investors are encouraged to ignore short-term market noise and focus on their long-term financial goals. The story of Ronald Read, a janitor who amassed a multi-million dollar fortune through consistent, long-term investing, serves as a prime example.
OTHER BOOKS ON INVESTMENT PORTFOLIO ALLOCATIONS
GONE FISHIN’ PORTFOLIO SUGGESTS DO-IT-YOURSELF INVESTING WITH LOW-COST, DIVERSIFIED, PASSIVE INDEX FUNDS
Manage Your Own Money: The book's central argument advocates for self-management of investments. Green argues that financial advisors often have inherent conflicts of interest and that their fees can significantly erode investment returns. He quotes prominent figures like Paul Samuelson, Ben Stein, Phil DeMuth, and William Bernstein to support the view that the investment industry can be costly and not always aligned with the client's best interests. The chapter emphasizes that the Gone Fishin' Portfolio is simple enough for individuals to manage themselves, negating the need for expensive professional help.
Common Stocks: The book presents the case for investing in common stocks through low-cost index funds. Green presents historical data on the long-term performance of stocks and argues that actively managed funds generally fail to beat their benchmarks over time due to higher fees and other factors. He champions the low-cost approach pioneered by Vanguard founder John Bogle and emphasizes that lower costs directly lead to higher returns for investors. The endorsement of indexing by investment legends like Buffett and Lynch further strengthens this argument.
Your Single Most Important Investment Decision: The book identifies asset allocation as the primary driver of long-term investment returns, citing the influential studies by Gary Brinson. Green argues that deciding how to allocate your investments across different asset classes is far more critical than individual security selection or market timing. This chapter introduces the philosophical underpinnings of the Gone Fishin' strategy, which aims for higher returns with less volatility through a strategic mix of noncorrelated assets.
The Gone Fishin' Portfolio Unveiled: This is the core of the book, where Green explicitly details the asset allocation of the Gone Fishin' Portfolio using specific Vanguard mutual funds. He recommends allocating percentages to U.S. total stock market, U.S. small-cap stock, European stock, Pacific stock, emerging markets stock, short-term investment-grade bond, high-yield corporate bond, inflation-protected securities, real estate index, and gold miners ETF (later revised to VanEck Vectors Gold Miners ETF). The chapter provides the fund symbols and explains the rationale behind each asset class's inclusion. It also introduces the crucial step of annual rebalancing.
“Asset allocation accounted for more than 90% of the total return”
“The best way to own common stocks is through an index fund”
PERSPECTIVE OF ALEXANDER GREEN, AUTHOR GONE FISHIN’ PORTFOLIO
Alexander Green is presented as an experienced investment professional with over three decades in the field as an investment analyst, portfolio manager, and financial writer. He is the Chief Investment Strategist of The Oxford Club and an editor of the Liberty Through Wealth investment research service. His background includes having been a registered investment advisor for 16 years. This experience lends credibility to his advice, as he claims to have learned many investment truths "the hard way".
Green's perspective is clearly that of an advocate for the individual investor, critical of the high fees and often self-serving nature of the traditional financial services industry. He emphasizes simplicity, low costs, and a disciplined, long-term approach to wealth building. Despite acknowledging his own success in individual stock picking, he argues that for most people, a systematic, diversified approach like the Gone Fishin' Portfolio is the most reliable path to financial freedom with minimal effort. His writing style is accessible and aims to empower ordinary individuals to take control of their financial futures.
BESTSELLER INVESTING BOOKS
“Wall Street excels at salesmanship, not money management”
GONE FISHIN’ PORTFOLIO PRESENTS A SIMPLE, RATIONALE, LOW-COST BALANCED INVESTMENT PORTFOLIO
Simplicity and Clarity: The book's greatest strength lies in its ability to distill complex investment concepts into a simple, actionable strategy. Green avoids jargon and explains the rationale behind each component of the portfolio in a clear and understandable manner. The specific recommendations of Vanguard funds and ETFs eliminate ambiguity and provide readers with concrete steps to follow.
Strong Rationale: The strategy is not based on speculation or fleeting trends but on well-established principles of asset allocation, diversification, and the historical performance of different asset classes. Green supports his arguments with references to academic studies, the wisdom of renowned investors, and historical data.
Focus on Low Costs: The book rightly emphasizes the detrimental impact of high investment fees on long-term returns. By advocating for low-cost index funds and ETFs from Vanguard, Green provides a practical way for investors to minimize expenses and maximize their net returns.
Empowerment of the Individual Investor: The book's message is empowering, encouraging readers to take responsibility for their financial well-being and manage their own investments. It challenges the notion that professional financial advisors are always necessary and highlights the potential cost savings and alignment of interests in self-management.
Low Time Commitment: The promise of a sophisticated investment strategy that requires less than 20 minutes of annual maintenance is highly appealing to busy individuals who do not want to spend significant time managing their portfolios.
SOME READERS OF GONE FISHIN’ PORTFOLIO MAY DISAGREE WITH PRESENTED PORTFOLIO ALLOCATION
Reliance on Vanguard: While Vanguard is a reputable provider of low-cost funds, the strategy's heavy reliance on a single fund family might not appeal to all investors. Some may prefer to diversify across different fund providers. However, Alexander Green does offer an ETF alternative using Vanguard and iShares.
Simplification Might Oversimplify: While the simplicity of the strategy is a strength, some investors with more complex financial situations or a deeper interest in investing might find the prescriptive nature of the single portfolio allocation somewhat limiting. The book does not delve into personalized adjustments based on individual risk tolerance beyond a general allocation to bonds.
Potential for Underperformance in Certain Markets: As Green acknowledges, the conservative allocation with a significant portion in bonds might lead to underperformance during periods of strong equity market growth. The "not about beating the market" mantra might not fully satisfy investors solely focused on maximizing returns, even if it comes with higher risk.
The Inclusion of Gold and Junk Bonds: Some critics, as mentioned in the book, might question the inclusion of asset classes like gold shares and high-yield corporate bonds (junk bonds) due to their volatility and potential risk. While Green provides a rationale for their inclusion as imperfectly correlated assets that can boost returns and reduce overall portfolio volatility, some investors may prefer a more traditional asset allocation.
“The key to making money in the market is time, not timing”
“You do not gain an edge by trying to time the market”
WHO SHOULD READ GONE FISHIN’ PORTFOLIO?
The primary target audience for "The Gone Fishin' Portfolio" is individuals who are new to investing or feel overwhelmed by the complexity of the financial markets. It is also ideal for busy professionals and those who prefer a hands-off approach to managing their long-term investments. The book's accessible writing style and clear instructions make it suitable for readers without a strong financial background. It will particularly appeal to those seeking a simple, low-cost, and time-efficient strategy to achieve financial independence. Skeptical investors wary of Wall Street's advice and high fees will also find Green's perspective resonating.
WHICH BOOKS ARE SIMILAR TO GONE FISHIN’ PORTFOLIO?
"The Little Book of Common Sense Investing" by John C. Bogle: As the founder of Vanguard, Bogle's book is a seminal work championing low-cost index fund investing. Green frequently references Bogle and Vanguard, highlighting the influence of his philosophy on the Gone Fishin' Portfolio.
"The Intelligent Investor" by Benjamin Graham: A classic text on value investing, Graham's principles of long-term investing, risk management, and avoiding speculation resonate with the core tenets of Green's strategy. Green quotes Graham in the book.
"A Random Walk Down Wall Street" by Burton Malkiel: This book argues that stock prices follow a random walk, making it virtually impossible to consistently outperform the market through active trading or stock picking. This supports Green's preference for indexing .
"The Four Pillars of Investing" by William J. Bernstein: Bernstein's book provides a comprehensive framework for long-term investing, emphasizing asset allocation, diversification, and cost control, principles shared by Green.
HOW DOES GONE FISHIN’ PORTFOLIO DIFFER TO COMPARABLE BOOKS?
What sets "The Gone Fishin' Portfolio" apart from other books on similar topics is its highly specific and prescriptive nature. While many books advocate for index fund investing and asset allocation, Green provides a concrete portfolio allocation with specific fund recommendations (and ETF alternatives), leaving little room for reader interpretation or customization. This "paint-by-numbers" approach is intended to overcome investor inertia and provide a clear roadmap for implementation. The book's integration of slightly less conventional asset classes like REITs and gold shares within a predominantly index-based framework also offers a distinct flavor compared to purely broad-market index strategies. Furthermore, the book's strong emphasis on minimizing time commitment as a key benefit is a central theme that differentiates it from some more academically focused or comprehensive investment guides.
GONE FISHIN’ PORTFOLIO – CONCLUSION
"The Gone Fishin' Portfolio: Get Wise, Get Wealthy … and Get On with Your Life" is a valuable resource for individuals seeking a simple, low-cost, and time-efficient strategy for long-term investing and achieving financial independence. Alexander Green effectively demystifies the world of finance, empowering readers to take control of their financial futures by following a disciplined approach rooted in sound investment principles. While its prescriptive nature might not suit every investor, its clarity, strong rationale, and focus on minimizing costs and time commitment make it a compelling guide for those looking to "get wise, get wealthy ... and get on with their life". The book successfully delivers on its promise of providing a powerful yet simple investment system, making the goal of financial freedom more attainable for the average person.
“Lower costs, higher returns”
ABOUT ALEXANDER GREEN, AUTHOR OF GONE FISHIN’ PORTFOLIO
Alexander Green is the Chief Investment Strategist for The Oxford Club, the world’s largest financial fellowship with more than 110,000 Members. He worked as an investment advisor, research analyst and portfolio manager on Wall Street for 16 years. After developing his extensive knowledge and achieving financial independence, he retired at the age of 43.
Since then, he has been living “the second half of his life.” He runs The Oxford Communiqué, which has been ranked as one of the top investment newsletters by Hulbert Digest for more than a decade. He also operates three fast-paced trading services: The Momentum Alert, The Insider Alert and The True Value Alert.
He prefers working as a writer instead of as a licensed investment advisor because he can give advice freely, write what he wants about the market and be completely objective in his recommendations.
FREQUENTLY ASKED QUESTIONS ABOUT GONE FISHIN’ PORTFOLIO
What exactly is the "Gone Fishin' Portfolio," and what makes it different from other investment strategies?
The "Gone Fishin' Portfolio" is a long-term investment strategy centered around asset allocation and annual rebalancing using low-cost index funds or Exchange-Traded Funds (ETFs). The core principle is to diversify across various asset classes, including U.S. stocks, foreign stocks, Real Estate Investment Trusts (REITs), and gold shares. The specific allocation model suggests 30% in U.S. stocks, 30% in foreign stocks, 5% in REITs, and 5% in gold shares, with the remaining 30% in high-quality U.S. bonds.
What sets it apart is its simplicity and low maintenance. Once set up, it purportedly requires less than 20 minutes a year to maintain. Unlike strategies that rely on market timing, individual stock picking, or active fund management, the Gone Fishin' Portfolio embraces the unknowable nature of the future market and focuses on what investors can control: saving, compounding, asset allocation, security selection (choosing low-cost index funds), costs, and taxes. It's designed to outperform most professional money managers over the long term by minimizing fees and adhering to a disciplined approach.
Why should I consider managing my own money using the Gone Fishin' Portfolio instead of hiring a financial advisor?
The book strongly advocates for managing your own money, primarily because no one cares more about your money than you do. The author argues that the investment industry is often geared towards generating fees and commissions for brokers and advisors, which can erode your returns.
The Gone Fishin' Portfolio is presented as a simple enough strategy for anyone to implement and maintain, negating the need for expensive professional advice for most investors. The strategy utilizes low-cost Vanguard mutual funds or ETFs, which further minimizes expenses. By managing your own money with this system, you can save thousands of dollars in investment costs over your lifetime and achieve potentially higher net returns. Moreover, it frees up your time, allowing you to focus on other aspects of your life instead of constantly monitoring the markets or evaluating fund managers.
How much time and effort will it realistically take to get the Gone Fishin' Portfolio up and running, and what's involved in the annual maintenance?
Setting up the Gone Fishin' Portfolio is described as straightforward. It involves visiting the Vanguard website or calling them to open an account and invest in the specific index funds or ETFs corresponding to the recommended asset allocation. The book emphasizes that Vanguard provides the investment vehicles, not the strategy itself. Once the initial setup is complete, the annual maintenance primarily involves rebalancing the portfolio.
Rebalancing is the process of adjusting your asset allocation to bring it back to the original target percentages. This is typically done by selling some of the assets that have performed well and buying more of the assets that haven't. The author claims this process should take less than 20 minutes per year. There is also an optional website, GoneFishinPortfolio.com, intended to help track progress and remind users of the annual steps. The goal is to have your investments on "autopilot," requiring minimal ongoing attention.
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