[lookout123]

Bruce, does the author have an agenda? He is obviously selling a book telling people interested in investing about HIS way of making money. i'm not familiar with his book, so he may have valid strategies, but i think it is important to remember that he benefits from convincing people that another way of investing isn't as profitable as his way. as always, you can find a study to support any theory you might have.

BUT, i would caution anyone who thinks they are going to become wealthy by being involved in the stock market. the purpose of investing is not to create wealth from nothing. it is to manage funds in a manner that will encourage growth over the long term. investors looking for get rich plans are generally the ones who lose A) the greatest amounts and B) more often. the market is useful for asset maintenance and growth with a view for the long term. it is no more suitable for wealth creation than the lottery or roulette wheel.

as i've said before, the average investor is best served by holding most of their $$ in quality mutual funds. while it is true that there is a greater potential for gain in individual stocks, unless an investor has enough cash to build a quality, diversified, and balanced stock and bond portfolio they run a greater risk of loss than is prudent.

of the 41 clients that i handle with more than $1Million in the market not a single one has less than $200,000 in quality mutual funds. they also own stocks and bonds but they will all tell you that they started with the bulk of their money going into Funds because they needed the relative stability early in their investment plans. (also, funds may be more costly in the short term, but much more cost effective in the long term because once an individual has invested within a fund family they can rebalance and move money around within all of the available fund choices at no further cost.) they are not the Trumps or the Soros's of the world. they are men and women who worked hard in a normal career and followed the advise of an honest broker.

there are brokers and investment advisors who are less than scrupulous - just as there are teachers, lawyers, doctors, etc who don't always have their clients' best interest in mind. you will also find brokers who just don't know what they are doing or have been trained improperly. but the majority of brokers take their responsibility very seriously and provide the best possible advise. as i tell my clients, no matter how good a broker or investor is - they will be wrong about 20-25% of the time on individual stock picks. we don't carry a crystal ball.

and before tw even shows up to yell from the mountain tops that you don't need a broker because we are nothing but "shined up sales whores", always remember you can invest on your own.

there are plenty of wire houses in existance. a layperson can research and learn to do very well by picking their own investments. they may do better or worse than they would have if they had used a broker - results will vary. one of the biggest benefits of using a full service broker is simply having someone between you and your money. people who handle their own money often make decisions that are more motivated by emotion or feeling than on logic and facts. a broker has the ability to ask "why?" and provide an outside, unbiased opinion before placing questionable trades. the broker will also push issues that the individual investor would ignore. (proper balance and diversification)