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- 12-Steps:
- Step 1
Step 1: Active Investors
Definitions
Problems
- 1.3.1 Active Investors are Everywhere
- 1.3.2 Active Investors are Gamblers
- 1.3.3 Active Investors Lose
- 1.3.4 The Poor Accounting of Active Investors
- 1.3.5 Stock Market Prices are Random
- 1.3.6 Stock Markets are Efficient
- 1.3.7 When Risk Capacity is not Matched with Risk Exposure
- 1.3.8 The High Cost of Turnover
- 1.3.9 The Emotional Stress of Active Investing
- 1.3.10 More than 1,500 Investors can be Wrong
- Step 2
Step 2: Nobel Laureates
Definitions
Solutions
- Alfred Nobel
- Blaise Pascal
- Edmund Halley
- Adam Smith
- Louis Bachelier
- Alfred Cowles
- Harry Markowitz
- James Tobin
- Frank Modigliani
- Merton Miller
- William Sharpe
- Paul Samuelson
- Eugene Fama
- Michael Jensen
- Rex Sinquefield
- Friedrich von Hayek
- Burton Malkiel
- John Bogle
- David Booth
- Kenneth French
- Who Do You Trust?
- Market Forces: May They Be With You
- Step 3
Step 3: Stock Pickers
Definitions
Problems
- 3.3.1 Why Stock Pickers Fail
- 3.3.2 The Stock Picker’s Graveyard
- 3.3.3 Incubator Funds
- 3.3.4 Studies and Observations that Show the Daunting Odds of Stock Picking
- 3.3.5 Stock Pickers and Coin Flippers
- 3.3.6 Stock Pickers are Focused on Short Term
- 3.3.7 Stock Pickers are Style Drifters
- 3.3.8 Stock Pickers are Looking for a Needle in a Haystack
- 3.3.9 Stock Pickers Play a Zero Sum Game
- 3.3.10 Stock Pickers in International Markets
- 3.3.11 Stock Pickers in Small-Cap Markets
- 3.3.12 Stock Pickers Pay More Taxes
- 3.3.13 Stock Picking Gurus and Their Real Records
- 3.3.14 Stock Pickers Don’t Want You to Know the Truth
- Step 4
Step 4: Time Pickers
Problems
- Step 5
Step 5: Manager Pickers
Problems
- Step 6
- Step 7
Step 7: Silent Partners
- Step 8
Step 8: Riskese
Definitions
- 8.2.1 Standard Deviation
- 8.2.2 Probability Distributions and Histograms
- 8.2.3 Mean Reversion
- 8.2.4 Expected Return
- 8.2.5 Rolling Period Returns
- 8.2.6 Risk
- 8.2.7 The Dimensions of Stock Return
- Market Risk Factor
- Size Risk Factor
- Value Risk Factor
- Term Risk Factor
- Default Risk Factor
- 8.2.8 Implications of the Fama/French Three-Factor Model
- 8.2.9 Time Diversification of Risk
Problems
- Step 9
Step 9: History
- Step 10
Step 10: Risk Capacity
Definitions
Problems
- Step 11
Step 11: Risk Exposure
Definitions
Problems
Solutions
- 11.4.2 Index Mutual Funds Earn more Return and Eliminate more Risk
- 11.4.3 The Most Efficient Funds on the Market
- Small Cap Strategy
- U.S. Small-Cap Strategy
- U.S. Micro-Cap Strategy
- Value Strategies
- U.S. Small-Cap Value Strategy
- U.S. Large-Cap Value Strategy
- Real Estate Securities Strategy
- U.S. Large Company Strategy
- Developed International Markets
- Emerging Markets
- Fixed Income
- 11.4.4 Are Commodities Worth the Risk?
- 11.4.5 Matching People with Portfolios
- Step 12
Step 12: Invest and Relax
Definitions
- 12.2.1 Registered Investment Advisers
- 12.2.2 Dimensional Fund Advisors
- 12.2.3 Rebalancing Portfolios
- 12.2.4 Rebalancing Formula
- 12.2.5 Tax Loss Harvesting
- 12.2.5a Mutual Fund Distributions
- 12.2.5b Cash Withdrawal Considerations
- 12.2.6 Financial Advice
- Estate Planning
- Insurance
- Accounting and Tax Advice
- Investment Advisors
- Life Planning
- The Glide Path of Life and Your IFA Index Portfolio
- Retirement Planner
Problems
- 12.3.1 Active Investors Procrastinate
- 12.3.2 Active Investors "Go It Alone"
- 12.3.3 The Media Wants Investors to Worry
- Asset Allocation
- Minimization of Investment Costs
- Minimization of Taxes
- Reliable Investment Performance
- A Simple and Understandable Investment Strategy
- An Easier Way to Track Investment Performance
- Increased Leverage and Compounding
of Investment Wealth - Invest like Institutional Investors
The “Go-To” Handbook On Intelligent Investing
Hebner is on a mission to change the way the world invests—by replacing speculation with education. With that in mind, this little gem packs hard data, visually attractive charts and graphs with more than 60 original oil paintings, nearly 40 unique portraits, and more than 120 color graphics, many portraying 83 years of historic stock market data. This colorful and graphically pleasing, 5"x7" compact, 318-page book is a quick, intelligent read and arguably the most artistic book ever written on investing.
What The Experts Are Saying
"Hebner gives us good advice presented in a very appealing manner. Index Funds remains one of the most valuable investment guides available."
Professor of Economics, Princeton University and author of A Random Walk Down Wall Street, Tenth Edition, 2011
"It is really beautiful and really well done. I plan to use it as a reference guide."
— David G. Booth
Chairman and Co-Chief Executive Officer,
Dimensional Fund Advisors, Inc., Benefactor of the University of Chicago Booth School of Business
"… as this book documents so well, a foolish attempt to beat the market and get rich quickly will make one’s broker rich and oneself much less so."
Nobel Laureate in Economics, Professor of Economics at the
University of California at San Diego, Rady School of Management
"This book is WONDERFUL!"
Founder of Aronson Johnson Ortiz, Institutional Investment Manager
Index Funds: The 12-Step Program for Active Investors
- The Original "Big Book"
Read below for more information about the previous edition of the Index Funds book.
► Download
eBook
|
Index Funds Second Printing with 2006 Data - Hardcover Available at amazon.com  Four color 415 pages (8.5 x 11"), hardcover edition with dust jacket. Ninety-four original paintings and 250 color graphics. It is the most colorful and graphically pleasing book ever written on this often dry subject. Destined to become the first coffee table book on investing.
|
Acclaim Reviews
"Mark Hebner's magnificent book presents solid financial theory and practice wrapped in an elegant package."
- Harry Markowitz Ph.D., Nobel Laureate in Economics, “Father of Modern Portfolio Theory," Professor of Economics at University of California at San Diego, author of Portfolio Selection: Efficient Diversification of Investments as well as numerous other books, articles and papers.
"...a valuable reference; and it benefits from your many perspicacious commentaries.
- Paul A. Samuelson, Nobel Laureate in Economics, M.I.T. Professor of Economics.
"...an incredibly handsome and wise book. We must be near a "tipping point" of passive over active. Perhaps your book will mark the moment. Congratulations!"
- John C. Bogle, Founder and Past CEO of The Vanguard Group 11/3/05
"...it clearly gives good advice which is presented in a very appealing manner. Congratulations on a very nice piece of work."
- Burton G. Malkiel, Professor of Economics, Princeton University, author of A Random Walk Down Wall Street: Completely Revised and Updated Eighth Edition
"I have personally read hundreds of books on finance, the stock market, and economic and financial history (I read about 20 books a year on the subjects). Of course, there are many fascinating well-written books, but I can honestly say you really only need to read two or three books to get started studying the science of finance (Capital Ideas) and applying some of the principles to your own benefit (The Intelligent Asset Allocator or Mark Hebner's Index Funds[: The 12-Step Program for Active Investors]- New!)"
- John P. Scordo, Esq. research-finance.com
"It is really beautiful [and] really well done. I plan to use it as a reference guide."
- David Booth, CEO, CIO and Co-Chairman, Dimensional Fund Advisors, Inc.
"Mark Hebner's book deserves a place on every coffee table in America." -Larry Swedroe More from Larry Swedroe and his books.
"The more I study and learn about your approach, the more I grow to appreciate its elegance...This book explains the merits of passive 'index investing,' and why trying to choose hot stocks is a fool's errand."
-Matt Krantz, USA Today 5/17/05, 5/20/05, 7/13/05, 10/2/05
About the book and author:
The financial services industry has a dark secret, one that costs global investors about $2.5 trillion per year (about 10% of the $25 trillion global equity market.) This secret quietly drains the investment portfolios and retirement accounts of almost every investor. In 1900 French mathematician, Louis Bachelier, unsuspectingly revealed this disturbing fact to the world. Since then, hundreds of academic studies have supported Bachelier's findings. Unfortunately, investors pay little attention to academics and Nobel laureates. The dark secret is that managers don't beat markets. The fact is, markets outperform managers by a substantial margin over long periods of time. This book offers overwhelming proof of this, and shows investors how to obtain their optimal rate of return by matching their risk capacity to an appropriate risk exposure. A globally diversified portfolio of index funds is the optimal way to accomplish this. Index Funds: The 12-Step Program for Active Investors is the treatment of choice for wayward investors. Most investors continue to embrace an active investing strategy, despite the extensive academic research demonstrating its futility.Speculating on the next winning stock, fund manager, investment style or market timing are all akin to gambling. Below market returns in investment portfolios and pension accounts are the result of investors gambling with their hard earned money. This 12-Step Program will put active investors on the road to recovery. Each step is designed to bring investors closer to embracing a prudent and sound strategy of buying, holding, and rebalancing an index portfolio.
Mark T. Hebner is the president of Index Funds Advisors in Irvine, California. His flagship Web site, ifa.com, is considered the leading Internet source of information on index funds. Hebner has been founder, president and CEO of three companies, one of which became a publicly held corporation. Hebner, a successful businessman, has spent the past six years developing this book and its companion Web site, ifa.com. Like many other investors, his conversion to the index funds investment philosophy began when he came to the realization that his own investment portfolio was not performing anywhere near the market averages. As he sees it, his own active investing strategy cost Hebner a whopping $30 million. Since his discovery, he has worked tirelessly to educate the investing public on the advantages of investing in index funds. He led a team of over 60 writers, artists, graphic designers, mathematicians, statisticians, and researchers to build the Internet's most comprehensive Web site on index funds. They then turned their attention to creating this book. It is the most colorful and graphically pleasing book ever written on this often dry subject. Forty-four original oil paintings, created by Lala Ragimov, fifty original water color portraits by Aftab Alam, and more than 250 color graphics by Jackson Lin present nearly 80 years of current and historic stock market data. This book is the culmination of hundreds of years of academic research, and with it Hebner hopes to cure the investing public of their active investing behaviors. Because of the beautiful art work and creative graphics it is destined to become the first coffee table book on investing.
Reviews from Amazon.com.
From a reformed pusher , November 9, 2005
| Reviewer: | Petri R. (Finland) |
Can't Beat'em ...So Join'em , November 3, 2005
| Reviewer: | R. Grey (Denver, CO) |
This is the last investment book that you need to buy. This is the primer for index fund investing. You can cancel your subscriptions to the Wall Street Journal, Investor's Business Daily, Money magazine, and Morningstar. The hunt for the Holy Grail of investing is over. Individual investors will understand why their mutual funds and stocks never produce the "advertised" returns. More importantly, they will understand what they need to do to capture the predicatable performance of the financial markets, and sleep at night.
Finally a rigorous and honest investment guide, April 21, 2006
Reviewer: Benjamin L. Brinkerhoff (San Diego)
I'm an economist and statistician and have been looking for an honest and ethical guide to investing for some time. This book offers a thorough review of 75 years of rigourous academic research on the topic investing. He proves through numbers and evidence the wisdom and peace of mind that can come through a passive investing methodology where risks are properly accounted.
This book will teach you the necessities of investing in a non-pretentious way and educate you so you can avoid wall streets marketing campigns and greedy commissions and fees.
I recommend this book to any new investor and any seasoned investor unfortunate to be stuck with a full brokerage firm. You will not be dissapointed.
A must ! , October 17, 2005
| Reviewer: | Bogdan Sabac (Princeton NJ USA) |
The book has it all from explaining serious pitfalls of investing such as stock picking and market timing to data backed examples on how to construct a diversified portfolio for maximum returns.
Follow the advice in the book and you will most likely beat 90% of the professional money manages in the next 20 years.
Regards, Bogdan Sabac
The Atheistic Investor, August 12, 2006
| Reviewer: | Dustin C. Stiefel (Dallas, TX) |
After 12 years in the industry as a "financial advisor",
I set out to discover what I really believed. I started my
search as an "Atheistic Investor" as if I believed
in none of the mainstream theories. After finishing Mark's
book I saw the light. I realized I had been living a lie
for the past decade convincing clients that I, combined with
the right fund manager, could beat the markets. I now realize
the true efficiencies of the market and have completely transformed
my business and practice. This book and it's clear principles
are a must read for everyone in our industry.
- 12-Steps:
- Step 1
Step 1: Active Investors
Definitions
Problems
- 1.3.1 Active Investors are Everywhere
- 1.3.2 Active Investors are Gamblers
- 1.3.3 Active Investors Lose
- 1.3.4 The Poor Accounting of Active Investors
- 1.3.5 Stock Market Prices are Random
- 1.3.6 Stock Markets are Efficient
- 1.3.7 When Risk Capacity is not Matched with Risk Exposure
- 1.3.8 The High Cost of Turnover
- 1.3.9 The Emotional Stress of Active Investing
- 1.3.10 More than 1,500 Investors can be Wrong
- Step 2
Step 2: Nobel Laureates
Definitions
Solutions
- Alfred Nobel
- Blaise Pascal
- Edmund Halley
- Adam Smith
- Louis Bachelier
- Alfred Cowles
- Harry Markowitz
- James Tobin
- Frank Modigliani
- Merton Miller
- William Sharpe
- Paul Samuelson
- Eugene Fama
- Michael Jensen
- Rex Sinquefield
- Friedrich von Hayek
- Burton Malkiel
- John Bogle
- David Booth
- Kenneth French
- Who Do You Trust?
- Market Forces: May They Be With You
- Step 3
Step 3: Stock Pickers
Definitions
Problems
- 3.3.1 Why Stock Pickers Fail
- 3.3.2 The Stock Picker’s Graveyard
- 3.3.3 Incubator Funds
- 3.3.4 Studies and Observations that Show the Daunting Odds of Stock Picking
- 3.3.5 Stock Pickers and Coin Flippers
- 3.3.6 Stock Pickers are Focused on Short Term
- 3.3.7 Stock Pickers are Style Drifters
- 3.3.8 Stock Pickers are Looking for a Needle in a Haystack
- 3.3.9 Stock Pickers Play a Zero Sum Game
- 3.3.10 Stock Pickers in International Markets
- 3.3.11 Stock Pickers in Small-Cap Markets
- 3.3.12 Stock Pickers Pay More Taxes
- 3.3.13 Stock Picking Gurus and Their Real Records
- 3.3.14 Stock Pickers Don’t Want You to Know the Truth
- Step 4
Step 4: Time Pickers
Problems
- Step 5
Step 5: Manager Pickers
Problems
- Step 6
- Step 7
Step 7: Silent Partners
- Step 8
Step 8: Riskese
Definitions
- 8.2.1 Standard Deviation
- 8.2.2 Probability Distributions and Histograms
- 8.2.3 Mean Reversion
- 8.2.4 Expected Return
- 8.2.5 Rolling Period Returns
- 8.2.6 Risk
- 8.2.7 The Dimensions of Stock Return
- Market Risk Factor
- Size Risk Factor
- Value Risk Factor
- Term Risk Factor
- Default Risk Factor
- 8.2.8 Implications of the Fama/French Three-Factor Model
- 8.2.9 Time Diversification of Risk
Problems
- Step 9
Step 9: History
- Step 10
Step 10: Risk Capacity
Definitions
Problems
- Step 11
Step 11: Risk Exposure
Definitions
Problems
Solutions
- 11.4.2 Index Mutual Funds Earn more Return and Eliminate more Risk
- 11.4.3 The Most Efficient Funds on the Market
- Small Cap Strategy
- U.S. Small-Cap Strategy
- U.S. Micro-Cap Strategy
- Value Strategies
- U.S. Small-Cap Value Strategy
- U.S. Large-Cap Value Strategy
- Real Estate Securities Strategy
- U.S. Large Company Strategy
- Developed International Markets
- Emerging Markets
- Fixed Income
- 11.4.4 Are Commodities Worth the Risk?
- 11.4.5 Matching People with Portfolios
- Step 12
Step 12: Invest and Relax
Definitions
- 12.2.1 Registered Investment Advisers
- 12.2.2 Dimensional Fund Advisors
- 12.2.3 Rebalancing Portfolios
- 12.2.4 Rebalancing Formula
- 12.2.5 Tax Loss Harvesting
- 12.2.5a Mutual Fund Distributions
- 12.2.5b Cash Withdrawal Considerations
- 12.2.6 Financial Advice
- Estate Planning
- Insurance
- Accounting and Tax Advice
- Investment Advisors
- Life Planning
- The Glide Path of Life and Your IFA Index Portfolio
- Retirement Planner
Problems
- 12.3.1 Active Investors Procrastinate
- 12.3.2 Active Investors "Go It Alone"
- 12.3.3 The Media Wants Investors to Worry
- Asset Allocation
- Minimization of Investment Costs
- Minimization of Taxes
- Reliable Investment Performance
- A Simple and Understandable Investment Strategy
- An Easier Way to Track Investment Performance
- Increased Leverage and Compounding
of Investment Wealth - Invest like Institutional Investors
Backtested Performance Info | Terms of Use | IMPORTANT DISCLOSURES
Index Funds Advisors, Inc. — 19200 Von Karman
Ave., Suite 150 — Irvine, CA 92612
Call Toll Free: 888-643-3133 — Local Phone: 949-502-0050 — Fax: 949-502-0048 — Email: 
For several other offices and representative locations, see About Us.