Posted as an Amazon Book Review
November 22, 2009
--Michael L Loren (Kansas City) - Amazon Verified Purchase

Trend investing safely and intelligently

Like many of you, I have been reading a ton of investment books over the last year. Many are veiled in selling a product or "let us manage your funds." Some are very scary. This is a practical method of investing in up and down markets. Hevner is not selling anything. The pitfalls in investing include factors that undermine the serious main street investor.- Hevner lists these quickly in the beginning and outlines the dangers out there. He gives a strong case for avoiding individual stocks. He gives very good advice in trending ETF's/mutual funds with stops and trailing stops. He gives a useful tip in receiving email alerts about a price point an ETF may hit to alert you to sell or buy. He has a special interest in "supercharging" a portfolio with certain asset classes and focuses alot of discussion on lowering risk. The best part of the book is how he actually uses examples in buying and selling. This is not a complicated system and he gives all the references for being successful. He briefly mentions using options only in the terms of the safety put. The weakest part of the book is the emphasis on having a "core portfolio" of buy and hold. I would imagine that the author is rethinking that idea. To be fair, the author toward the end of the book, does suggest treating the "core" with stops. This book has the potential to be revolutionary for both the main street investor and the deservedly maligned stock broker. "Intelligent Investor" stand aside and make room for "The Perfect Portfolio".

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Posted as an Amazon Book Review
September 22, 2009
--Chkm8k2 - Amazon Verified Purchase

A Prominent Place in Your Trading Library

I have a raft of books in my trading library and this one deserves a place near the front of the line. Written by the President of the National Association of Online Investors, Leland Hevner is an accomplished writer and educator. He has a knack for taking a reader by the hand and bringing him up to speed, in understandable terms, on the techniques involved in constructing The Perfect Portfolio. Whether or not you construct his Core and Target Market allocations, this book would be an invaluable guide in maintaining and analyzing any portfolio, whether set up along the guidelines of the book, or your own that you have lost control of over the years and want to get back on track. 

Rarely does an author take you in amazing detail and STEP BY STEP through the process of constructing an investing portfolio that can be followed and tweaked from time to time as market conditions dictate. Leland has a gift for making sense of financial subjects and soon you will be mastering them as well. His strategy does take some time and dedication to implement, but nothing exceptional. After that, a little time spent monitoring it, and you are on your way. You will honestly be learning and understanding what you are investing in, broad and target market ETF's or mutual funds that give the portfolio instant diversification and upside potential. He shows you how to continue to track and monitor each part of the portfolio while limiting losses and preserving upside potential. 

If you have a son or daughter coming out of college with a long investing horizon, this would be an invaluable primer on how to build meaningful wealth in the years ahead. Those nearing retirement who have seen their net worth take a beating over the past 18 months can benefit as well. Indeed, who couldn't use some help making sense of today's investment climate? 

Read it, and read it again. This could be the most important book you have read in quite some time.

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Posted as an Amazon Book Review
May 18, 2009
--Gary MacNeil, Garden City, NY

Best Investment Book I've Read In A Long, Long Time

I like to read many investment books, always looking for guidance. This is by far the best I've read in a long time. It is the one book that has most changed the way I invest.

Why do I love it? Because it took away so much of what I hate about investing.

For example, last year I came to hate buy and hold, which for most investors during the market meltdown turned into "cry and fold." I love Hevner's solution--a simple, elegant strategy for being in the market--any market--for the big upmoves, yet nimbly stepping aside to avoid the steep downturns.

If you never again want to find yourself helplessly standing there, frozen like a deer in the headlights, meekly obeying buy-and-hold conventional wisdom while an enraged bear paws away 40% or more of your wealth--which can happen at any time in any market--heed Mr. Hevner. He gives you a simple way to know when to leave the scene before a murderous bear shreds what's left of your life savings. In essence, he teaches you an easy-to-follow way to let your profits run and cut your losses short, the essence of successful investing.

Likewise, I have come to hate rebalancing during a falling market, as conventional wisdom dictates. Rebalancing assumes that a given market, like a cork, will reliably and soon pop back up to the surface. But what if it doesn't? The worst downturns can last for decades. After the Great Depression, stocks eventually fell 86% and didn't come back to breakeven for 25 years. In Japan, stocks plunged 63% after 1989 and still have not fully recovered, some 20 years later.

If that's in the cards for U.S. stocks now, do you really want to be rebalancing, throwing good money after bad, every miserable step of the way down for years or even decades to come? How will you feel if you take more of your life savings to rebalance your equities and then the market falls another 50% from here? The market can stay irrationally brutal much longer than you can stay solvent!

Hevner teaches what I believe is a more sensible plan--how to be safe and on the sidelines, or even profiting handsomely, during major and possibly prolonged downturns. It's a great relief to know that you don't have to buy and hold or rebalance when every cell in your brain and your gut is screaming not to throw more good money after bad and that doing so may turn out to be the dumbest form of "capital" punishment you'll ever practice. Your first obligation is to protect your money against further losses, not remain obedient to buy-and-hold and rebalancing.

I have also come to hate the idea, peddled by many on Wall Street, that mutual funds and money managers deserve lucrative annual fees, even though they consistently underperform index funds. Thanks to John Bogle and now, with Hevner's more advanced use of index funds and ETFs, I have found how I can consistently outperform overpaid gurus myself while saving significant fees each year.

I hate the classic definition of "diversification" being limited to just stocks, bonds, and cash. I believe that's now too simplistic for today's world, as it assures you will miss out on booming upmoves in more precisely defined asset classes. I love Hevner's strategy for making money when any of nine major asset classes may be off to the races regardless of what the major equity markets may be doing. If there's a bull market someplace, or even better, when several are stampeding at once, Hevner's targeted "buy-and-sell" strategy for each can let you ride them for huge gains even while the S&P or Dow are slumbering or falling. This can add real pop to your results.

Finally, I hate feeling so much uncertainty about where and how to invest. It can easily come to obsess your mind and distract you from what you're supposed to be doing, such as making a living. Instead of always second guessing yourself about how to invest, Hevner will teach you how to keep it simple, letting you know exactly when to be in for the major trends...and out during the major downturns. Hevner thus makes it much easier to manage your portfolio and follow clear rules of the road in just minutes a day, or even minutes a week if you prefer. This frees you to exhale, forget stocks for long stretches, and invest your mental capital on the more important areas of your life and career.

These are the reasons I love this book and find myself rereading it every chance I get, to make sure the lessons stick with me for as long as I live. It truly has changed my whole approach to investing and has proven exceedingly profitable already. Best of all, I know I'll never again be mauled by savage 30%-50% or worse losses. Thanks to Hevner, I am never again going to allow that to happen to me.

As he suggests, you can try his approach for yourself for a portion of your portfolio and see for yourself how well it works before you commit more money. That's what I did and am delighted with the results, not only in much higher profits but especially the infinitely greater peace of mind that comes from ever-present protection against devastating losses.

I should also tell you that this is the first review I've ever posted on Amazon. Until reading this book, I didn't know Hevner even existed, so it's not like I'm writing this for a friend, business colleague or for any motive other than gratitude for someone who took away so much of what I hated about investing and replaced it with this simple strategy that I love. I suspect that for you, as for me, this book will easily be one of the most profitable investments you will ever make.