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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
| IFA Books |  |
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
Mark T. Hebner
President and Founder of Index Funds Advisors, Inc.
Author of Index Funds: The 12-Step Recovery Program for Active Investors
Review
of IF:12-Step for Active Investors 
View CEO Authors, Passion of the Pen article featuring Mark Hebner
"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 Tenth Edition
One of Three "All Time Greatest Investment Books." Three
Authors Nominated: Bogle, Hebner & Buffett. "I just mentioned your
book as one of the three all-time greatest investment books
in a poll conducted by the leading investment magazine here in
Finland (my other choices were Bogle's "Common
Sense on Mutual Funds" and Buffett's Shareholders Letters)." (See
Article)
- Anders Oldenburg, Investment Advisor, Seligson & Co 11/15/06
One
of Three Authors to Read; Peter and William
Bernstein and Mark Hebner:
"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).
... you really only need to read two or three books to get started studying
the science of finance (Capital Ideas) and...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
Excellent
Book, concise, informative, and interesting, 2/24/07,
Creative Guy (Cheyenne, WY) This is one of the best books on
investing I have read. I recently read around 15 different books
on investing and this book was probably the best. I have recommended
this book to several friends. ... This book is gold.
- Source: amazon.com
One of Three Authors to Read: Bernstein,
Hebner and Bogle - Matt Krantz, USA Today 11/2/2006
"The more I study and learn about your approach, the more I grow
to appreciate its elegance. Matt
Krantz, USAToday, 5/20/05
One of Four Authors to Read on Asset Allocation: Bernstein, Gibson, Hebner and Ferri: - "Mark T. Hebner provides one of the best overviews for passive or index investing. In his Index Funds book, Hebner goes into the history and research for this approach to investing. If cost is an issue, this book is a best buy. I also recommend visiting the IFA web site as it is one of the very best available." - Lowell Herr, ITA Wealth Management.
"I have read hundreds of financial books and
this book ranks in the top 10" - Garen L. Wisner, Cincinnati,
OH, 1/31/07 (amazon.com)
One
of Three Books to Read: Bernstein, Hebner and
Bogle - Beware of the broker with the desperate 'gamblers'
mindset': There are a number of books you can read to get
started: The Four Pillars of Investing: Lessons for Building
a Winning Portfolio by William J. Bernstein, Index
Funds: The 12-Step Program for Active Investors by Mark Hebner,
or anything written by Vanguard founder John Bogle. - Matt Krantz,
USA Today 11/14/2006
Having worked in the financial services industry for over 20 years,
I have known about our "dark
secret" for a while. Over the years I have provided thousands
of "addicts" with
their fixes, thinking if I don't, someone else will. Now, having
come out of the closet of "smoke and mirrors", I can only hope that
a book like Mark Hebner's 12 Steps gets a huge following among all
types of investors.. I am finally able to meet my clients with a
straight face." - From a Reformed Pusher
Petri, R. (Finland) 11/9/05
I HIGHLY recommend going to the website of Index Funds Advisors (www.ifa.com) and going through their 12-Step Program for Active Investors, which starts at http://www.ifa.com/12steps/step1/. [printed version in the book] Good books include Burton Malkiel’s classic “A Random Walk Down Wallstreet”, William Bernstein’s “The Intelligent Asset Allocator”, though the math is somewhat tough if you don’t have a statistics background (though you can skip the math and still learn a lot about funds). - Ron said at 5:02 pm on February 20th, 2010
Recommended Reading
These books were among the many books used in the development of the investment strategies of Index Funds Advisors. The first book summarizes what is found in most of the books below it. The lack of reading these books is at the heart of the failure of investors. |
Robbing You Blind |
 |
How the Really Smart Money Invests
(VHS Video) |
 |
Prudent Investor's Guide to Beating
Wall Street at Its Own Game |
- 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.