I recently finished ”Think, Act, and Invest Like Warren Buffett: The Winning Strategy to Help You Achieve Your Financial and Life Goals,” by Larry Swedroe. The Warren Buffett stuff is just a facade — a shtick to get investors who are frightened by scholarly works to read the book. Nevertheless, the book is worth reading, and is generally well-written and accessible. As far as I can tell, it’s correct in all of its prescriptions. None of it really breaks new ground, but it’s a book worth reading.
One particularly new bit of information I got from it was the “Opportunistic Rebalancing” approach to rebalancing a portfolio. The idea is that you check your portfolio often for opportunities to rebalance it (weekly or even more often) but, because you’re only rebalancing when your portfolio gets outside a tolerance zone, you’re not actually rebalancing (and incurring trading costs) that often. As I wrote about in my Chapter 6 notes from Investor’s Manifesto, William J. Bernstein doesn’t recommend it, but it’s certainly not a dangerous idea — per Bernstein it’s simply a lot of work for probably not much gain.
So what the bottom line on this book? It’s worth reading, but it doesn’t replace “Investor’s Manifesto” as my pick for the first book you should pick up in your quest for financial competence. It’s hard to match Bernstein’s incredibly clear and well-written prose. Swedroe is good, but Bernstein is better. I’ve added this book to the Reading List in the “Optional Reading” section.