Figuring It Out Sixty Years of Answering Investors' Most Important Questions

An indispensable collection of essays from one of the investment world’s leading lights

In Figuring It Out: Answers to the Most Difficult Investment Questions, world-renowned investing and finance guru Charles D. Ellis delivers a robust collection of incisive essays on an array of perennial and contemporary investing issues, from the rise and fall of performance investing to a compilation of essential investing guidelines.

In the book, you’ll also find eye-opening discussions of:

• Whether bonds are an appropriate investment vehicle for long-term investors
• The costs of excessive liquidity in the typical portfolio
• The characteristics of successful investment firms, and how to spot them

A can’t-miss resource for the everyday retail investor, author Charles Ellis draws on a lifetime of distinguished client service in the financial markets to reward readers with common-sense and accessible advice that deserves to be followed by anyone with an interest in maximizing their investment returns over the long haul.

CHARLES D. ELLIS is one of the leading contributors to the investment profession. He has chaired the CFA Institute, served as a Director of Vanguard and on over a dozen investment committees, including many years on the Yale Investment Committee. He has taught advanced investment courses at both Harvard Business School and Yale School of Management. This is his 19th book.

Foreword ix

Note on the Text xi

Introduction xiii

1 The Changing Game 1

2 The Loser’s Game 35

3 The Winners’ Game 47

4 The Winner’s Game II 61

5 The Rise and Fall of Performance Investing 73

6 Seven Rules for More Innovative Portfolio Management in an Age of Discontinuity 89

7 Will Success Spoil Performance Investing? 93

8 To Get Performance, You Have to Be Organized for It 99

9 Investing Success in Two Easy Lessons 107

10 The End of Active Investing? 111

11 In Defense of Active Investing 119

12 Murder on the Orient Express: The Mystery of Underperformance 127

13 Best Practice Investment Committees 141

14 Levels of the Game 157

15 An Invitation to Winning 163

16 Small Slam! 167

17 A Lesson from Seaside Cemetery 171

18 Tommy Armour on Investing 173

19 Ted Williams’ Great Lessons for Investors 177

20 Symptoms and Signs 181

21 Lessons from the Warwick and Château Chambord 191

22 Investment Management Fees Are Higher Than We Think 199

23 Computer People May Be Planning a Revolution 203

24 Characteristics of Successful Investment Firms 207

25 A New Paradigm of Investment Management 215

26 Lessons on Grand Strategy 221

27 Pension Funds Need MORE Management MANAGEMENT 227

28 The Significance of 65 233

29 Where Were We? 237

30 Hard Choices: Where Are We Now? 243

31 Bonds for Long-Term Investors? 251

32 What Role Should Bonds Play? 261

33 Too Much Liquidity Will Cost You 265

34 Letter to My Grandkids: 12 Essential Investing Guidelines 269

35 Miss Sally’s Attic 277

36 Ben Graham: Ideas as Mementos 281

37 The Corporate Tax Cut 291

38 Repurchase Stock to Revitalize Equity 295

39 Anti-Trust, Bank Mergers, and the PNB Decision 315

Index 325

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