Muggers in investment metropolis

A devastating chapter in The Investor’s Manifesto by William J. Bernstein (www.wiley.com) is the one titled ‘Muggers and worse.’ In every town and city, people generally avoid certain areas after dark, and it is the same in the investment metropolis, he writes in a section named ‘The world’s largest bad neighbourhood.’

Cautioning not to venture ‘more than 10 yards form the front door,’ the author observes that the prudent investor treats almost the entirety of the financial industrial landscape as an urban combat zone. “This means any stock broker or full-service brokerage firm, any newsletter, any advisor who purchases individual securities, any hedge fund. Most mutual fund companies spew more toxic waste into the investment environment than a third-world refinery… Who can you trust? Almost no one.”

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