Since the height of the financial crisis the buy-and-hold crowd has been on the defensive.  Now Burton Malkiel, author of A Random Walk Down Wall Street, is coming to its defense.  Malkiel notes the benefits of portfolio diversification, the low costs of indexing and portfolio re-balancing.  He documents one such strategy would have worked over the past decade.  One thing he doesn’t do is note the psychological challenges in following this type of strategy.  In an interview Malkiel plays down the downside of ETFs.  He notes how ETFs serve the indexer well by lowering their costs.  In today’s screencast we highlight some time-tested rules from one of the original EMH proponents.

Items mentioned in the above screencast:

On the benefits of diversification, low costs and portfolio re-balancing. (WSJ)

The buy-and-hold crowd is back.  (Abnormal Returns)

Buy-and-hold the best of a bad lot? (Abnormal Returns)

Why Burton Malkiel “loves” ETFs.  (IndexUniverse)

This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.

The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client.

References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.

Please see disclosures here.

Please see the Terms & Conditions page for a full disclaimer.