Outpacing the Pros is the latest attempt to explain how ordinary investors can outperform managed mutual funds.
Written by David Blitzer, the book sheds light on index-tracking securities and how these are a far better bet than using a fund manager.
Starting with the statistic that up to 70 per cent or more of actively managed mutual funds fail to even equal the returns of the Standard & Poor's (S&P) 500 Index, the book's premise seems attractive enough.
By using indexes to operate their investment strategy, an investor can closely match their returns.
Blitzer explains that despite the derision which often greets index-based funds, the facts tell their own story. From September 1976 to the end of 1999, for example, the Vanguard 500 Index Trust provided an annual total return of 15.85 per cent.
Aside from pure index funds, Blitzer also deals with how indexes can be used to evaluate individual stocks, and how a retail investor can build a sample portfolio. Coming in the wake of a slew of books about investment theory and portfolio management, the book's content may at first appear redundant.
However, its unique feature is undoubtedly Blitzer's ability to explain indexes in a clear, understandable fashion. As chief investment strategist and director of quantitative services for S&P, he brings a wealth of expertise to the topic, and supplements this with a lucid and thoughtful writing style.