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.

Dr. Burton G. Malkiel, Professor of Economics, Princeton University

Dr. Malkiel is an economist and writer, most famous for his classic finance book A Random Walk Down Wall Street (now in its 9th edition, 2007). Dr. Malkiel also served as a member of the Council of Economic Advisers (1975-1977), president of the American Finance Association (1978), and dean of the Yale School of Management (1981-1988).

How Malkiel's advice relates to The System In his 9th and latest book, "A Random Walk Guide To Investing.." Dr. Malkiel wrote an investment book for the layperson which effectively summarizes The System including The Law of Compounding, investing in low index funds across several asset classes, finding your optimal asset allocation which reflects your time horizon, your financial capacity to absorb losses, and your risk tolerance. Malkiel outlines the benefits of index funds. They incur lower operating costs. They have lower turnover, which leads to lower transaction costs and greater tax efficiency. Consequently, index funds beat actively managed funds by 2 percentage points. Malkiel states this superior performance is a direct result of index funds low cost advantage.