Value Averaging: The Safe and Easy Strategy for Higher Investment Returns (Wiley Investment Classics) 
asked by siriusfanboy on November 25, 2006 9:56 AM
Michael Edleson first introduced his concept of value averaging to the world in an article written in 1988. To satisfy investor interest, he wrote a book entitled Value Averaging,which further detailed this method. Following the publication of the last edition of this highly sought after book in 1993, it has been nearly impossible to find—until now. With the reintroduction of Value Averaging, you now have access to Edleson’s original work on a strategy that can help you accumulate wealth, increase your investment returns, and achieve your financial goals.
Michael E. Edleson is a Managing Director of Morgan Stanley and oversees the firm’s equity risk globally. Prior to that, he was Chief Economist of NASDAQ and a finance professor at Harvard Business School. Edleson earned his PhD at MIT.
Reviews
0%
0%
This book should be of intense interest to followers of Robert Lichello's "AIM" (Advanced Investment Management), "Twinvest", and "Synchrovest" dollar-cost averaging methods from 2 generations ago, but Lichello and Prof. Edleson seem to have been unaware of each other's work (understandable given the lack of an internet at the time; their books lived on different sides of the bookstore aisles, "academic" and "popular" works) and no cross-pollinization took place. In any event, Value Averaging is a graduate-level discussion of all the issues about dollar-cost averaging that the AIM students have been struggling toward.
Value Averaging can be tough going for anybody without solid undergraduate math skills, but is deliberately constructed to be utilized by anybody trained in algebra, so my suggestion would be to read through the narrations for the concepts and then go back to the chapters covering the methods you think you would like to use to attack the math. I would suggest not bothering to construct the Excel simulator unless you really think you are going to get different results than a Harvard professor and former chief economist at NASDAQ did in hundreds of tries.
Several chapters are of universal value to practical students of the stock market: a modern recalculation of performance and volatility for the market for the whole historical period of 1926-2006 is given (each generation needs this exercise to renew the debates about what type of investing produces the best yields), universal volatility ranges for the whole market are derived (a simple single range which can save you countless dollars of subscriptions to simulation softwares), and instructions are given for how to construct simulations in Microsoft Excel (most of the new content in the 2006 paperback edition describes how to translate the original spreadsheeting instructions into excel). This little book is packed with permanent value for students of all stock market systems.
Lichello's AIM investors must have this book if they are to take their ideas to the next level, and Prof. Edleson may find himself inheriting the mantle of a movement he may have been wholly unaware of before republishing his method.
Value Averaging can be tough going for anybody without solid undergraduate math skills, but is deliberately constructed to be utilized by anybody trained in algebra, so my suggestion would be to read through the narrations for the concepts and then go back to the chapters covering the methods you think you would like to use to attack the math. I would suggest not bothering to construct the Excel simulator unless you really think you are going to get different results than a Harvard professor and former chief economist at NASDAQ did in hundreds of tries.
Several chapters are of universal value to practical students of the stock market: a modern recalculation of performance and volatility for the market for the whole historical period of 1926-2006 is given (each generation needs this exercise to renew the debates about what type of investing produces the best yields), universal volatility ranges for the whole market are derived (a simple single range which can save you countless dollars of subscriptions to simulation softwares), and instructions are given for how to construct simulations in Microsoft Excel (most of the new content in the 2006 paperback edition describes how to translate the original spreadsheeting instructions into excel). This little book is packed with permanent value for students of all stock market systems.
Lichello's AIM investors must have this book if they are to take their ideas to the next level, and Prof. Edleson may find himself inheriting the mantle of a movement he may have been wholly unaware of before republishing his method.
reviewed by bones on November 26, 2006 7:02 PM
0%
0%
I bought a copy of this book from the author about 6 years ago and have found it to be the most useful investment manual I have yet discovered. It played an important role in planning for an early retirement, and I continue to use it in maintaing my retirement portfolio. Two chapters will appeal to an investor at almost any level of sophistication--one dealing with a program of dollar cost averaging adjusted for growth in market values, and one outling a system of "value averaging." The first helps investors to keep their contributions on track to meet their investment goals, and the second provides a rational basis for investors to sell shares, if they are so inclined, when the market departs significantly from a projected "value path." Both programs can be adjusted periodically to reflect changed assumptions about probable market returns.
I hardly know how to praise this book highly enough. My own mathematical skills are so poor that I periodically re-read the central chapters to remind myself of the logic I am following. But Edleson helpfully supplies some step-by-step examples of spreadsheet programs that will fully deploy the formulas he explains. This is a first rate book that deserves to be back in print at a reasonable price. But even at [the price], it's worth it.
reviewed by speaker on November 29, 2006 7:22 PM