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Bogle's Big Mistake
hocus 02-18-2007, 2:33 PM | Post #195211 | 
I added an article to my site on Friday entitled Bogle's Big Mistake.

Juicy Excerpt: "Say that you are trying to steer a boat through the ocean. You have checked a map and know that all you need to do to reach your destination is to continue sailing straight ahead. In short, you need to "Stay the Course!" You notice a change in the winds and in the currents. What is your response? Do you hold the wheel firm in the face of these changes or do your make gentle turns to the left or to the right to counter the effects of the changing conditions about you?

"You make gentle turns, of course. An informed understanding of what it means to "Stay the Course!" is that it requires reasonable responses to changed conditions. When valuations change, the "Stay the Course" investor needs to change his stock allocation to keep his risk profile consistent with what he determined it should be back when he set his initial allocation."

It's worth checking out the comments that were filed to my blog entry announcing publication of this article. Interesting comments were posted by a community member named "Peter," who describes himself as a regular reader of this forum.


Originally posted in thread: 57550
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