What do you think?
Rate this book
Think, Act, and Invest Like Warren Buffett
If you wanted to create the next earth-shattering consumer product, Steve Jobs would be an ideal role model to follow. If you planned to become a great golfer, you might look to Arnold Palmer or Jack Nicklaus. So, if your goals are to outperform other investors and achieve your life's financial goals, what should you do? Think, act, and invest like the best investor out Warren Buffett. While you can't invest exactly like he does, Think, Act, and Invest Like Warren Buffett provides a solid, sensible investing approach based on Buffett's advice regarding investment strategies. When it comes to investing, Director of Research for the BAM Alliance and CBS News blogger Larry Swedroe has pretty much seen it all--and he's come to the conclusion that simple is better, that adopting basic investing principles always increases an investor's chance of success, and that Buffett is an excellent model for such investing. In Think, Act, and Invest Like Warren Buffett , Swedroe provides the foundational knowledge you need
159 pages, Paperback
First published January 1, 2012
73 people are currently reading
572 people want to read
Ratings & Reviews
Friends & Following
Create a free account to discover what your friends think of this book!
Community Reviews
Displaying 1 - 30 of 41 reviews
February 24, 2013
Very short video of three things I like about this book, and one I don't:
http://www.financinglife.org/book-rec...
Video transcript:
Hi, I’m Rick. I’d like to review this new book by telling you three things I like about it, and one I don’t.
First, I make short explanatory videos so I read a lot of these kind of books. I’m giving this book 5 stars because this is a shorter crisper version of his first book. The particular part of both books that I find most compelling is the demonstration of how combining truly diversified kinds of funds results in a better overall portfolio. It’s valuable, well-done and easy-to-understand.
Second, the book is thankfully short and sweet. It is wisdom that every working American should know. But it’s rarely taught — let alone taught well. So this is a book for everyone saving and investing. It’s really not hard. If you are going to do it yourself, this steps you through all the key decisions. But, if you decide that you want to hire a financial advisor you really need your eyes wide open. Not only will this book give you the background to recognize good advice in advance, but it has a chapter telling you how to go about hiring a good financial advisor.
Third, in this book he incorporates sketches from Carl Richards — which are not only brilliant for their wisdom, but fun.
So, nearly everyone should read it, but maybe not for the reason they’ll buy it. Which brings me to the one thing I’m not fond of: the title. But, it is a clever hook to get people to buy the book. It’s only natural for people to want to think, act, and invest like Warren Buffett. And admittedly, the first two chapters explain why they can’t, and why (in fact) Warren Buffett recommends index funds at a very low cost for nearly everyone else. And that’s what the book is about.
So I highly recommend this book. Check it out.
http://www.financinglife.org/book-rec...
Video transcript:
Hi, I’m Rick. I’d like to review this new book by telling you three things I like about it, and one I don’t.
First, I make short explanatory videos so I read a lot of these kind of books. I’m giving this book 5 stars because this is a shorter crisper version of his first book. The particular part of both books that I find most compelling is the demonstration of how combining truly diversified kinds of funds results in a better overall portfolio. It’s valuable, well-done and easy-to-understand.
Second, the book is thankfully short and sweet. It is wisdom that every working American should know. But it’s rarely taught — let alone taught well. So this is a book for everyone saving and investing. It’s really not hard. If you are going to do it yourself, this steps you through all the key decisions. But, if you decide that you want to hire a financial advisor you really need your eyes wide open. Not only will this book give you the background to recognize good advice in advance, but it has a chapter telling you how to go about hiring a good financial advisor.
Third, in this book he incorporates sketches from Carl Richards — which are not only brilliant for their wisdom, but fun.
So, nearly everyone should read it, but maybe not for the reason they’ll buy it. Which brings me to the one thing I’m not fond of: the title. But, it is a clever hook to get people to buy the book. It’s only natural for people to want to think, act, and invest like Warren Buffett. And admittedly, the first two chapters explain why they can’t, and why (in fact) Warren Buffett recommends index funds at a very low cost for nearly everyone else. And that’s what the book is about.
So I highly recommend this book. Check it out.
December 1, 2022
I finished reading this book in the Pertamedika Hospital of Banda Aceh while guarding my daughter's treatment. Although the title of the book is Think Act and Invest Like Warren Buffett, do not expect that the whole book will discuss about Buffett's investing strategy. The author only talks about Buffett in 2 chapters (more or less 20 pages). Larry Swedroe emphasizes on his own winning strategy in investing. This book serves as both the winning strategy of broad global diversification and passive investing, and guidance on how to construct a portfolio to adapt with investors' various background and situation. Investor should understand various asset classes such as stocks, bonds, commodities, properties, mutual funds and ETFs. Swedroe suggests 60:40 stocks and bonds in portfolio to protect from market volatility. Swedroe argues that passive investing is the prudent investment strategy, because as a passive investor, a person will have more time for family, activities and other important things in life The book concludes with a list of Swedroe's 30 rules of prudent investing to help every investor. It is a good read on passive investing and should be considered as one of the best books on the topic.
March 2, 2014
Pretty good advice on the importance of being a passive investor. Not as much about Warren Buffet tho (but that's expected from such a short book). I would still recommend this quick read for beginner investors.
February 12, 2018
The title of this book is misleading. The book endorses the belief in the efficient-market hypothesis and what Eugene Fama has taught with respect to this erroneous hypothesis which Warren Buffet does not believe in.
January 30, 2019
A fairly short book on basics of index fund investing and asset allocation. I had read extensively on the subjects before, so there was nothing new for me in here. It may be useful for people who are new to index funds. There is nothing on Warren Buffett anywhere in the book aside from the title.
March 9, 2013
Reiterated what I already know, but it is nice to hear it again. To know that what I already know is actually good to know!!!
August 22, 2015
It was fine, but read more like a lengthy pamphlet than a book. Provided very little insight into what Buffett actually does, beyond "buy low sell high". And exercise patience in the market.
April 18, 2020
Apart from the beginning, the book isn't about Warren Buffet.
May 22, 2019
One of the greatest things about Warren Buffett is that he can take extremely complicated investing concepts and make them folksy, charming, and easy to both remember and understand. He's sort of like Mrs. Gump, "Now Forrest, investing is like a box of chocolates. The sea salt and caramel pay great dividends but you could risk getting them stuck in between your teeth. The milk chocolate are like triple a-rated municpal bonds that will hold their value. . ." The Oracle of Omaha is truly someone we can look to for clear cut advice.
That way, someone like Larry Swedroe can come in and write two chapters loosely associated with Mr. Buffett and spend the next 120 pages glossing over complicated concepts and complicating easy concepts. I am no financial manager or planner, so maybe I misunderstood some things. At one point he says that investors never take risks they aren't compensated for. A statement like that makes it sound like a risk free environment, which the market never is. In the discussion on rebalancing, he seemed to state that you should sell stocks that are doing well for ones that aren't. Why would you want to buy things that aren't performing? Sell off, sure. But use that money to buy something that isn't performing? Not so sure.
Other problems may just be due to the need for an updated version. Such as the notion that you should keep 6 months of reserve cash laying around. You'd be losing money on inflation every day that money isn't invested. ETFs could use a bit more focus too.
There's no discussion of value investing which, as I understand it, is what Buffett is really good at.
Any way, the best advice in the book can be summed up as follows: plan, accumulate, insure, and pay as little as possible. If I've made any errors in my assessment I hope someone will correct me. . .
That way, someone like Larry Swedroe can come in and write two chapters loosely associated with Mr. Buffett and spend the next 120 pages glossing over complicated concepts and complicating easy concepts. I am no financial manager or planner, so maybe I misunderstood some things. At one point he says that investors never take risks they aren't compensated for. A statement like that makes it sound like a risk free environment, which the market never is. In the discussion on rebalancing, he seemed to state that you should sell stocks that are doing well for ones that aren't. Why would you want to buy things that aren't performing? Sell off, sure. But use that money to buy something that isn't performing? Not so sure.
Other problems may just be due to the need for an updated version. Such as the notion that you should keep 6 months of reserve cash laying around. You'd be losing money on inflation every day that money isn't invested. ETFs could use a bit more focus too.
There's no discussion of value investing which, as I understand it, is what Buffett is really good at.
Any way, the best advice in the book can be summed up as follows: plan, accumulate, insure, and pay as little as possible. If I've made any errors in my assessment I hope someone will correct me. . .
May 9, 2017
I like this book. It is short and written in a way simple to understand. The strategies mentioned are simple too.
Key takeaways are to work towards being a PASSIVE investor. This way, you can just periodically rebalance and maintain your portfolio, while enjoying life and family. Active investing is what investment banks would like for clients to go into so as to earn lots of fees. Personal active investing also requires too much work for the little returns, and it is quite impossible to beat the market. Temperament is very important in investing, and it is important not to let emotions get in the way.
1) Begin with investment policy statement. What are your investment goals, risk appetite, invesment horizon etc.
2) Diversify your portfolio. Include stocks for large and small cap, value and growth, real estate, international developed markets, emerging markets, commodities and bonds. Sample portfolio as such: (S&P 500 - 7%, Fama/French US Large Value index - 7%, Fama/French US Small Cap Index, 7%, Fama/French US Small Value Index (ex utilities) - 7%, Dimensional Intl Small Cap Index - 14%, MSCI EAFE Value Index - 14%, Goldman Sachs Commodity Index - 4%, 5 yr treasury notes - 40%)
3) Rebalance asset when class's allocation is greater than either an absolute 5 or 25% of the original target allocation, whichever is less
4) 2 ways to rebalance is to sell what has done well to buy what has done poorly, or to use new cash to raise allocations of the asset classes that are below target levels, or a combination. Utilizing new cash is preferred as it reduces transactions and cost. and eliminates capital gains that are taxable.
Key takeaways are to work towards being a PASSIVE investor. This way, you can just periodically rebalance and maintain your portfolio, while enjoying life and family. Active investing is what investment banks would like for clients to go into so as to earn lots of fees. Personal active investing also requires too much work for the little returns, and it is quite impossible to beat the market. Temperament is very important in investing, and it is important not to let emotions get in the way.
1) Begin with investment policy statement. What are your investment goals, risk appetite, invesment horizon etc.
2) Diversify your portfolio. Include stocks for large and small cap, value and growth, real estate, international developed markets, emerging markets, commodities and bonds. Sample portfolio as such: (S&P 500 - 7%, Fama/French US Large Value index - 7%, Fama/French US Small Cap Index, 7%, Fama/French US Small Value Index (ex utilities) - 7%, Dimensional Intl Small Cap Index - 14%, MSCI EAFE Value Index - 14%, Goldman Sachs Commodity Index - 4%, 5 yr treasury notes - 40%)
3) Rebalance asset when class's allocation is greater than either an absolute 5 or 25% of the original target allocation, whichever is less
4) 2 ways to rebalance is to sell what has done well to buy what has done poorly, or to use new cash to raise allocations of the asset classes that are below target levels, or a combination. Utilizing new cash is preferred as it reduces transactions and cost. and eliminates capital gains that are taxable.
This entire review has been hidden because of spoilers.
June 12, 2022
Swedroe's book covers big questions investors may have on managing their finances:
+ Invest in actively managed vs. passively managed portfolio (index funds);
+ Listen to market forecasts;
+ Time the market.
He dispels some myths and reinforces the old tested-and-tried methods.
Thinking like Buffett means approaching your investments with your head above the water. During the bear markets, for instance, you can assume markets are expected to keep on falling if the future news is worse than already expected. Your thinking is relative to how good/bad the news is than what was expected. So if the news is no worse than expected, you earn high returns from low valuations. He does not pay attention to price but how good or bad is the news than what was already expected. Avoid Stage-1 thinking. See beyond the current crisis.
Develop a good plan. And stick to the plan like a sticker or refrigerator magnet. Write up your financial plan by reviewing your personal finances. Consider things like your job stability, job's correlation to stock holdings, investment horizon, risk tolerance, and emergency reserves. List a specific goal and action plan like the amount you will add to your portfolio each year, amount you will accumulate by a specific date.
The book also goes over what to make up in your portfolio based on your risk tolerance, how to rebalance your portfolio, etc. Learn Buffett's rules on investing for your life financial goals. This book is more general than specific in that it does not list specific individual stocks or funds. However, certain strategies may not weather today's volatile financial markets. It is good to know anyway.
+ Invest in actively managed vs. passively managed portfolio (index funds);
+ Listen to market forecasts;
+ Time the market.
He dispels some myths and reinforces the old tested-and-tried methods.
Thinking like Buffett means approaching your investments with your head above the water. During the bear markets, for instance, you can assume markets are expected to keep on falling if the future news is worse than already expected. Your thinking is relative to how good/bad the news is than what was expected. So if the news is no worse than expected, you earn high returns from low valuations. He does not pay attention to price but how good or bad is the news than what was already expected. Avoid Stage-1 thinking. See beyond the current crisis.
Develop a good plan. And stick to the plan like a sticker or refrigerator magnet. Write up your financial plan by reviewing your personal finances. Consider things like your job stability, job's correlation to stock holdings, investment horizon, risk tolerance, and emergency reserves. List a specific goal and action plan like the amount you will add to your portfolio each year, amount you will accumulate by a specific date.
The book also goes over what to make up in your portfolio based on your risk tolerance, how to rebalance your portfolio, etc. Learn Buffett's rules on investing for your life financial goals. This book is more general than specific in that it does not list specific individual stocks or funds. However, certain strategies may not weather today's volatile financial markets. It is good to know anyway.
June 22, 2018
An outstanding little book. 66 pages of reading about investment philosophy. It is along the same lines as the Barefoot Investor, but a higher brow and in an United States context.
I have already shared this book with appropriate friends. It does not go in depth, but is a guide of where to pursue further study in developing your own investment strategy. It recommends a passive strategy and having faith in the correctness of your long-term strategy. Do not panic because of a change in the weather, trust that you know the climate. It also gives advice on how to select professional advisors if required, and how to split responsibility to decrease your chance of being a victim of fraud.
I have already shared this book with appropriate friends. It does not go in depth, but is a guide of where to pursue further study in developing your own investment strategy. It recommends a passive strategy and having faith in the correctness of your long-term strategy. Do not panic because of a change in the weather, trust that you know the climate. It also gives advice on how to select professional advisors if required, and how to split responsibility to decrease your chance of being a victim of fraud.
August 10, 2018
After the intro, this book has almost nothing to do with Warren Buffett. But his name in the title is what led me to pick this up off the shelf, so I guess it worked.
A good, short read, filled with common-sense advice, perfect for a financial layperson like me. Biggest takeaway: Focus on the "big rocks" in your life (things that provide the richest meaning), not the "Holy Grail of Outperformance."
A good, short read, filled with common-sense advice, perfect for a financial layperson like me. Biggest takeaway: Focus on the "big rocks" in your life (things that provide the richest meaning), not the "Holy Grail of Outperformance."
April 10, 2022
Larry does a great job of emphasizing what he understands of the basics of investing and informs the readers how they too can implement those steps to successfully win in personal finances game of life. I appreciate the point he makes about spending more time "outperforming" investing does not necessarily pay with what it keeps us from enjoying if we invest in those things that are not indexed. Thank you for sharing what you have learned and observed from your work/life balance.
April 12, 2018
Basically a trimmed down version of the author's other book "the only investment guide you will ever need". Just skip this book and jump directly to the aforementioned one for a more detailed guideline.
November 12, 2018
Decent advice, but just another writer using Buffett's name on the cover of a book to write about his own investment strategy. This book does not share how Buffett analyzes a company. For this, read, "The Warren Buffetg Way."
October 15, 2020
I really liked this book. I like it how it teaches the information in the book. I think warren buffet is someone that a lot of investors look up to and it’s nice to see him writing books so we can gain all of his knowledge.
December 29, 2021
Great Insights and advice in this short , concise book. Definitely ba is up what I have read in other books and also provides new information that is helpful. Don't need to be an expert to read this book and feel more confident about investing.
December 31, 2022
This is going to rank on the top of my recommended investing books list for beginners. Very practical and concise book that is based on imperical data and less to no opinanated recommnedations. Don't judge the book by its title, it has nothing to do with Buffet active investing strategy, it is quite the complete opposite.
February 11, 2019
A good quick read for beginning investors. For my Canadian friends, not all of the advice applies here so be aware of that!
February 26, 2020
Quick read, definitely gives some good basic investing strategies. I think an new investor should read.
March 2, 2020
Short book with good advise. Specific to American market though.
April 14, 2020
Good to know how passive investing works.
June 15, 2020
A recap of what are mentioned by Warren buffet in his speeches and books and some personal tips from the author. Pretty good read to remind the reader on the common mistakes of investing.
September 13, 2020
Los consejos que dan son verdades irrefutables, pero el libro no aporta nada nuevo
January 19, 2023
It's recommended to read especially for newbie investors, so they can understand basic principles in organizaing investment portfolio.
This entire review has been hidden because of spoilers.
May 20, 2024
Good basic general investment book.
August 10, 2013
The title of this book is somewhat of a misnomer. Warren Buffet is actually an active investor, not a passive one, but Swedroe's main point is that you should be a passive investor.
This is a short read with some good points. I've come across most of these ideas and points before in other books, but if you're looking for something short and sweet to introduce you to the ideas of passive investing then I would recommend this book.
My only quibble is that the illustrations by Carl Richards are not new - they are the same illustrations as from Richards' book The Behavior Gap: Simple Ways to Stop Doing Dumb Things with Money (which I also highly recommend).
Swedroe is a good writer, clean, clear and concise, and he hits some excellent points and his 30 rules of Prudent Investing are worth the price of the book itself.
Recommended for personal finance junkies, passive investors, couch-potato investors and those who are looking for a good introduction to passive investing.
This is a short read with some good points. I've come across most of these ideas and points before in other books, but if you're looking for something short and sweet to introduce you to the ideas of passive investing then I would recommend this book.
My only quibble is that the illustrations by Carl Richards are not new - they are the same illustrations as from Richards' book The Behavior Gap: Simple Ways to Stop Doing Dumb Things with Money (which I also highly recommend).
Swedroe is a good writer, clean, clear and concise, and he hits some excellent points and his 30 rules of Prudent Investing are worth the price of the book itself.
Recommended for personal finance junkies, passive investors, couch-potato investors and those who are looking for a good introduction to passive investing.
Read
February 26, 2018In this book, Larry Swedroe highlights what he considered the most important financial management strategies to succeed in life. The content of this book is not something that you haven't read before. It talks about diversifying, tax management, whether you should hire a financial advisor or not, and the true reward of passive investing. There's no earth-shattering information, but time-old advices that has been proven to work amidst the ever-changing market. It is about staying rich.
The strategies here may not suit investors who like action all the time, who love the constant buzz of Wall Street. In fact, the author compared investing done right to watching the grass grow.
The strategies here may not suit investors who like action all the time, who love the constant buzz of Wall Street. In fact, the author compared investing done right to watching the grass grow.
December 24, 2013
For anyone who may have struggled with Swedroe's more technical writing, this book is a great way to get much of the substance the author is known for, but without getting weighed down by heavily technical analysis.
I also love how Swedroe's heart--his passion for his work and education--comes through. It's quality information from a good person.
I also love how Swedroe's heart--his passion for his work and education--comes through. It's quality information from a good person.
Displaying 1 - 30 of 41 reviews