While it is probably a poor idea to own actively managed funds in general, it is truly a terrible idea to own them in taxable accounts... taxes are a drag on performance of up to 4 percentage points each year... many index funds allow your capital gains to grow largely undisturbed until you sell... For the taxable investor, indexing means never having to say you're sorry.

Bluntly put, there's no chance that your doctor, dentist, or attorney is a high-school dropout. Your stockbroker, however, just might be.

The purpose of investing is not to simply optimise returns and make yourself rich. The purpose is not to die poor.

All the things that make us human make us terrible investors and you have to understand what they are and how to avoid them.

You have to ask yourself, what are the things that matter to you most in your life? If you have to have a latte every day that'snice to have right now, but if you take that latte every day right now, you may wind up eating cat food when you are 70. And you have to decide which is worse.

A decade ago, I really did believe that the average investor could do it himself. I was wrong. I've come to the sad conclusion that only a tiny minority, at most one percent, are capable of pulling it off. Heck, if Helen Young Hayes, Robert Sanborn, Julian Robertson, and the nation's largest pension funds can't get it right, what chance does John Q. Investor have?

Wall Street is littered with the bones of those who knew just what to do, but could not bring themselves to do it.