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Book Review and Giveaway: The Intelligent Portfolio

The books keep rolling in! It’s getting challenging trying to keep up with the book reading/reporting between all my other duties. However, since the readers seem to enjoy them (or maybe it’s the giveaways), I will keep doing them!

This hardcover book is about investing, portfolio creation and risk management. It’s titled “The Intelligent Portfolio – Practical Wisdom on Personal Investing from Financial Engines” written by Christopher L. Jones. The book is fairly lengthy and technical, but the beauty lies in the summary at the end of each chapter.

Who is the Author?

According to the publisher:

Christopher L. Jones is Chief Investment Officer and Executive Vice President of Investment Management for Financial Engines. Working closely with founder William F. Sharpe, Jones built and led the team of experts in finance, economics, and mathematics that developed the financial methodology for Financial Engines’ personalized investment advice and management services. Jones has led the investment management function at Financial Engines for more than a decade. He holds an MS in business technology, an MS in engineering-economic systems, and a BA in quantitative economics, all from Stanford University.

What Topics are Covered?

  • Recognizing the link between risk and reward
  • Leveraging the wisdom of the market
  • Minimizing losses due to investment fees
  • Avoiding the risks of stock picking
  • Selecting funds with proper forward-looking criteria
  • Understanding how to realistically fund financial goals
  • Investing tax-efficiently

Important Lessons

  • The most important diversification is the split between stocks/bonds, then between domestic/international equity.
  • Minimizing your investment expenses will result in a huge difference in portfolio value over the long term.
  • Higher expected returns will have a higher risk associated with them. However, not all high risk investments come with higher expected returns.
  • The most important factors in choosing a risk level are the tolerance for downside outcomes and the time horizon before the money is needed.
  • Investing in individual stocks are an unnecessary gamble. Historically, investors do better with diversified instruments like ETF’s/index mutual funds.

Final Thoughts

I enjoyed this hardcover book as it provides a lot of insight into the value of diversified low cost index investing through facts and hard earned experience. I would say that this book is geared towards investors who are already familiar with the markets but looking to expand their market knowledge.

For the beginner investor, this book may be a little intimidating and a touch on the dry side as it is fairly technical. However, I would say that this book would provide the right start on how to create a diversified portfolio at a risk level that is right for you.

Want a Free Copy?

  • Simply leave a comment and you’ll automatically be entered in the draw for a free copy.
  • Please only 1 comment entry / person (please enter a valid email address).
  • Only those with a North American mailing address may enter (publisher rules, sorry).
  • Contest will end Thursday 5pm EST June 12, 2008 and the winner announced shortly afterwards!

Find out how you can save an additional 4% on this book from Chapters.

If you would like to read more articles like this, you can sign up for my free weekly money tips newsletter below (we will never spam you).

FT About the author: FT is the founder and editor of Million Dollar Journey (est. 2006). Through various financial strategies outlined on this site, he grew his net worth from $200,000 in 2006 to $1,000,000 by 2014. You can read more about him here.

Comments on this entry are closed.

  • Avatar Farhan Thawar June 10, 2008, 8:50 am

    Looks interesting, however I’d rather read a book that also spoke of the Canadian market.

  • Avatar Doug Weber June 10, 2008, 9:26 am

    Interesting review. I would love a free copy and I do have a N. American address! Let me know if you select me and Thanks for keeping up with the reading and posting the information!

  • Avatar Joshua June 10, 2008, 9:39 am

    Sign me up for the big W! This book looks like a very fascinating read!

  • Avatar Pierre-Hugues June 10, 2008, 9:49 am

    I was just looking for some more advice on how to start creating a portfolio. Looks like an interesting read.

  • Avatar Aaron June 10, 2008, 9:57 am

    Excellent. I love these contests! Thanks again FrugalTrader.

  • Avatar Laura June 10, 2008, 9:58 am

    Sounds like a great book!

  • Avatar chris June 10, 2008, 10:16 am

    sign me up.

  • Avatar Telly June 10, 2008, 10:31 am

    I like winning!

  • Avatar Joe June 10, 2008, 10:43 am

    Thanks for the contest! Sign me up.

  • Avatar Finance_Addict June 10, 2008, 10:44 am

    Here is my post.

  • Avatar Judy June 10, 2008, 11:03 am

    Sounds like a great read – Tks Judy

  • Avatar David June 10, 2008, 11:03 am

    A book about the strength of index investing, that sounds very good!

  • Avatar Bob June 10, 2008, 11:03 am

    Sounds like an interesting read.

  • Avatar Dividend Growth Investor June 10, 2008, 11:05 am

    Pick me, pick me :-)

  • Avatar Greg June 10, 2008, 11:11 am

    Always want to learn more! Sign me up for the draw!

  • Avatar Millionaireby45 June 10, 2008, 11:34 am

    Sounds like a great book. You can never have too much knowledge especially when it comes to investing.

  • Avatar Christopher June 10, 2008, 11:35 am

    sounds like it would be a fairly interesting read.

  • Avatar Luc June 10, 2008, 11:40 am

    Sounds like a good read,

  • Avatar JME June 10, 2008, 11:40 am

    I would love to win the book

  • Avatar ryan June 10, 2008, 11:44 am

    i would like to see how this differs from the other investment books i have read.

  • Avatar Marianne O June 10, 2008, 11:53 am

    Time for me to level up from beginner to high-beginner books, as we’re just setting up self-directed RRSPs. This sounds like a useful book at this point in our financial journey.

    Thanks for the review.

  • Avatar Oscar June 10, 2008, 11:55 am

    Thanks for the book..
    Oscar

  • Avatar Chuck June 10, 2008, 11:58 am

    Here’s my entry!

  • Avatar James June 10, 2008, 11:59 am

    Seems like an interesting read. And the price is right!

  • Avatar MAC June 10, 2008, 12:01 pm

    thnaks for the book review. Hope to win it
    MAC

  • Avatar Andre June 10, 2008, 12:03 pm

    Sounds like an interesting read

  • Avatar Blitzkrieg June 10, 2008, 12:05 pm

    I’m in.

  • Avatar Mark June 10, 2008, 12:07 pm

    I like these investing books that have a mathematical basis to the theories.

    Does it also show how to recognise when a higher risk investment won’t come with higher returns?

  • Avatar Jim June 10, 2008, 12:08 pm

    Pick me for the free book! This could be a good read!

  • Avatar Susie June 10, 2008, 12:21 pm

    Love to learn…and I must say that I really enjoy your site. I have learned a lot and like the simple easy format. I look forward to my read every day. Thank you, FG

  • Avatar paulette June 10, 2008, 12:26 pm

    Nice book! Too bad for me im not qualified to join:(

  • Avatar Commander T June 10, 2008, 12:27 pm

    I am interested in this book.

  • Avatar Yuriy June 10, 2008, 12:35 pm

    Please, count me in. I would love to read something serious on the topic.

  • Avatar Jane June 10, 2008, 12:46 pm

    An intelligent portfolio? Count me in for the drawing!

  • Avatar Terri June 10, 2008, 1:12 pm

    Thanks for the review! I hope you pick me! :)

  • Avatar Daniel June 10, 2008, 1:20 pm

    Would saying that it’s my birthday tomorrow help me win? Did not think so. :-)

  • Avatar FearLES June 10, 2008, 1:22 pm

    Thanxs for the review. Good luck to everyone.

  • Avatar Michael Gillard June 10, 2008, 1:24 pm

    Looks good. Mine could certainly use some sprucing up!

  • Avatar ETF Income June 10, 2008, 1:27 pm

    I am in, thanks.

  • Avatar Sean June 10, 2008, 1:27 pm

    I’m feeling lucky!

  • Avatar talcumboy June 10, 2008, 1:33 pm

    Sign me up :).

  • Avatar Isabelle June 10, 2008, 1:35 pm

    This book sounds like what I need.

  • Avatar Jeremy June 10, 2008, 1:38 pm

    Book? I’d love it!

  • Avatar Stephen Winters June 10, 2008, 2:03 pm

    Another very interesting book read from a very interesting site.
    When are you going to be writing your own book FT?

  • Avatar Doug June 10, 2008, 2:03 pm

    I would love a free copy, thanks for the chance…

  • Avatar Returns Reaper June 10, 2008, 2:05 pm

    Sounds like a good book. I like the sounds of a book with a heavier technical weighting. Often I find books tend to shy away from the technical side of things to appeal to a larger audience. This makes it hard to find good material if you are interested in those details.

    Sign me up for the draw, please!

  • Avatar Nick June 10, 2008, 2:18 pm

    Sounds like an interesting read; especially about choosing ETFs over individual stocks.

  • Avatar Jordan Clark June 10, 2008, 2:31 pm

    Frugal,

    Has this book on portfolio creation changed any of your views on using a couch potato style portfolio?

    Please put me in for the draw.

    Jordan

  • Avatar pablo9567 June 10, 2008, 2:32 pm

    If you own stocks then you can’t afford to get news later than everyone else. Try easystockalerts.com for a week and you’ll see what I mean. There is no fee and no spam…so make money now and sign up for easystockalerts.com

  • Avatar tom June 10, 2008, 2:41 pm

    Hope foreign markets are sufficiently addressed!

  • Avatar Ringo June 10, 2008, 2:55 pm

    The contents of the book seem so interesting so it would be great if I can have a chance to read it through.

  • Avatar Kassam June 10, 2008, 3:09 pm

    I’m in!

  • Avatar gS49 June 10, 2008, 3:15 pm

    I’ll take it!

  • Avatar Jesus June 10, 2008, 3:17 pm

    Count me in!!

  • Avatar Alex Muchortow June 10, 2008, 4:09 pm

    Sounds like a good refresher to keep my investing on track

  • Avatar Nate June 10, 2008, 4:31 pm

    Entering the contest.

  • Avatar supersocco June 10, 2008, 5:01 pm

    I am going to be a DIY investor, so this is right up my alley

  • Avatar Andrew June 10, 2008, 5:12 pm

    Sounds like an interesting book. Please put me in for the draw.

  • Avatar Rob June 10, 2008, 5:40 pm

    Im in!

  • Avatar Kevin June 10, 2008, 6:13 pm

    I’m always interest in info on ETFs

  • Avatar Chris June 10, 2008, 6:35 pm

    The book sounds great. Sign me up!

  • Avatar Kenny June 10, 2008, 7:18 pm

    Sounds interesting…

  • Avatar newinvestor June 10, 2008, 7:44 pm

    Sign me up please

  • Avatar Elvis K June 10, 2008, 7:58 pm

    Elvis is in the building lol.

    Sign me up!

  • Avatar Patrick June 10, 2008, 8:10 pm

    I’d be interested to see how they reconcile the every-percentage-point-counts philosophy with the advice to diversify between stocks and bonds. If you’re not using your savings for a decade or two, what good are bonds?

  • Avatar Cash Canuck June 10, 2008, 9:24 pm

    Wow! Everyone loves a giveaway. Including me!

    I like books that aren’t afraid to throw some technical information at you. When I have a methodology to chew on, I can apply the writers’ systems to my own list of investments and see how closely I fit in.

    The whole idea about asset allocation, and ETF index investing seems like it fits in well with the popular investing mantra of the day (at least in the PF blogosphere), so it would be interesting what new material is brought to the table with this publication.

    Cheers!

  • Avatar cashinstinct June 10, 2008, 9:31 pm

    I am interested by this book!

    Thanks for giving it to one of your reader.

  • Avatar AndrewP June 10, 2008, 10:41 pm

    I’d love to read THIS book!

  • Avatar Warren June 10, 2008, 11:13 pm

    Wish me luck.

  • Avatar Jim June 10, 2008, 11:39 pm

    sign me up

  • Avatar B June 10, 2008, 11:40 pm

    Looks interesting… especially for the individual investor.

  • Avatar Debt_Free_in_5 June 11, 2008, 12:03 am

    Count me in

  • Avatar john sanderson June 11, 2008, 12:30 am

    First post here, although I’ve been reading with interest since the first of the year.

    Thanks for all your postings and efforts, you remind me of myself a few years ago – you’re on the right track in many respects, in my opinion.

    We’re always reading and learning, so a chance to have a new book in the library would be great. I’m interested in the ETF vs individual stock comparison.

    Keep up the good work.

    John in Kitchener

  • Avatar coolbeans99 June 11, 2008, 12:51 am

    I am in for the win!

  • Avatar spy vs. spy June 11, 2008, 1:11 am

    What do we know about author’s, Christopher L. Jones’, investing track record? Is he just a book worm?

  • Avatar Sarlock June 11, 2008, 1:16 am

    Sounds like a good read, I’ll toss my name in the hat.

  • Avatar Chris Chen June 11, 2008, 3:35 am

    This book sound very interesting. Put me down for one :)

  • Avatar Ken June 11, 2008, 4:45 am

    Count me in!

  • Avatar telefantastik June 11, 2008, 11:47 am

    i’m in! thx

  • Avatar Denny June 11, 2008, 3:50 pm

    Please include me in the draw!

    Thanks kindly!

  • Avatar RI June 11, 2008, 6:43 pm

    Sign me up! Is there any discussion of asset allocation?

  • Avatar Quick Lunar Cop June 12, 2008, 9:40 am

    Please count me in! I haven’t read this one yet!

  • Avatar Colleen June 12, 2008, 9:52 am

    I appreciate your effort on this blog. Love it!

  • Avatar Matt V June 12, 2008, 11:34 am

    I’m in! Great site…

  • Avatar Kyle June 12, 2008, 12:43 pm

    I have never heard of Christopher Jones, but put his name next to Will Sharpe and I’m sold! Beginner investment books are a dime a dozen these days, but a solid guide for advanced investors is rare. I look forward to reading it.

  • Avatar Stephen Oakes June 12, 2008, 3:44 pm

    The best thing you can do as an investor is to read as many books out there like this one. It’s important to learn what your investment style is.

    Once you learn and understand the basics, draft up a strategy and test it. If it’s successful, use it as your base and continue to tweak, perfect, or create new strategies that could provide higher returns at a reduced risk level.

    But more importantly, use a stop-loss you’re comfortable with to protect you in the event unforseen market forces go against your position.

    These are general tips I realize, but very crucial in building an investment foundation with which you can fill the gaps and learn how make money.

    -S

  • Avatar Todd June 12, 2008, 5:13 pm

    count me in too!

  • Avatar Matt T June 12, 2008, 7:06 pm

    Looks like a good one, love to read!