The Experts

The System has been revealed in studies and recommendations from some of the world's most prominent finance professors, authors and investors. See more expert quotes here.

William Bernstein

Mr. Bernstein has become a well-known investment author, having written "The Four Pillars of Investing," and "The Intelligent Asset Allocator." Mr. Bernstein has been a critic of Wall Street and supports The System by proposing that investors buy index funds based upon their risk-return profile and that building a well diversified group of index funds.

How Bernstein's advice relates to The System Bernstein outlines The System in his own way using statistics and probabilities. His basic thesis: Build your portfolio with multiple classes of assets, invest entirely in index funds because professional stock and bond picking is a waste of time and money, and rebalance your portfolio regularly so that it maintains its original proportion for each asset class. Mr. Bernstein writes extensively to help investors arrives at the "right" mix of assets, but also points out that if over the past 10 or 20 years an investor had simply held a portfolio consisting of one quarter each of indexes of large U.S. stocks, small U.S. stocks, foreign stocks and high quality U.S. bonds, he would have beaten over 90% of all professional money managers and with considerably less risk. He proves mathematically that over a long enough time period, almost any reasonably balanced indexed strategy will best the overwhelming majority of professional managers.