AAA rating

, 248

Accredited investors

, 56

Actively managed fund

, 79, 342

versus index fund

, 342

Active management

, 294

Active return

, 367

Active share

, 303, 347

Actual returns

, 260

Adjustable rate mortgage

, 232

Affect heuristic

, 276

Algobots

, 405

Algorithm

, 332

Alice’s Adventures in Wonderland

, 4

Alpha

, 349

Alternative asset class

, 56

Alternative investment

, 56, 271

Anchoring and adjustment bias

, 117

Anchoring bias

, 117

Annuity

, 13

Arbitrage

, 397

Arithmetic return

, 260

The Art of Contrary Thinking

, 269

Asset class

, 55, 97

Assets under management

, 329

Availability bias

, 121

Availability heuristic

, 318

Average return

, 260

Baby boomers

, 21

Back-end load

, 339

Bandwagon effect

, 138

Basis point

, 338

The Battle for the Soul of Capitalism

, 315

Bear market

, 40, 212

The Beardstown Ladies

, 418

Behavioral biases

, 109

understanding and avoiding

, 139

Behavior gap

, 108

Belief perseverance biases

, 112

Benchmark

, 84

Bias

, 2

Bias blind-spots

, 32

Bid-ask spread

, 405

Blue chip

, 87

Blue chip companies

, 277

The Boston Post

, 160

Bounded rationality

, 264

Breakeven effect

, 128

Brexit

, 83

Broken the buck

, 240

Brokers

, 334

Bull market

, 40

Buy and hold

, 99

Call option

, 50

Capital advantage

, 400

Capital gain

, 78

Capital loss

, 78

Capital markets

, 97

Cash account

, 334

Caveats

, 401

Closet indexers

, 346

Closet index funds

, 302

Closet indexing

, 85

Coefficient of determination

, 303

Cognitive bias

, 109

Cognitive dissonance

, 112

Collateralized debt obligations (CDOs)

, 248

Commodity

, 209

Commodity pool

, 210

Common-Sense Investment Guide

, 418

Confirmation bias

, 112, 113

Conformity effect

, 137

Conservatism bias

, 115

Contingent deferred sales load

, 339

Contrarian investing

, 99

Correlation

, 270

Country risk

, 304

Covered call

, 51

Credit crisis

, 240

Credit crunch

, 240

Credit derivative

, 248

Credit event

, 249

Credit linked note (CLN)

, 248

Credit risk

, 239, 295, 304

Credit squeeze

, 240

Currency markets, features of

, 398

Currency risk

, 242, 304

Currency speculation

, 397

Current moment bias

, 130

Day trading

, 294, 398

Default risk

, 48

Defined benefit pension plan

, 6

Defined contribution plan

, 6

Derivative

, 271

Discount broker

, 335

Disposition effect

, 127

Diversifiable risk

, 47

Diversification

, 53, 269

Diworsification

, 58

Dollar-cost averaging (DCA)

, 67, 83, 99

The Donnie Deutsch Show

, 190

Downline

, 157

Downside risk

, 261

Due diligence

, 19

Duration

, 48, 242

Efficient market

, 110

Emotional bias

, 109

Endowment effect

, 133

Establish quantitative investment criteria

, 140

Excessive optimism

, 136

Exchangeable security

, 378

Exchange of futures for physicals

, 210

Exchange-traded fund (ETF)

, 80, 382

Exercise

, 50

Expected return

, 260

Expense ratio

, 301, 338, 342

Expenses, loads, and performance

, 342

Familiarity bias

, 124, 125

Fee-based advisors

, 14

Feeder hedge fund

, 172

Fee-only advisors

, 13, 14

Fiduciary

, 11

Financial leverage

, 398

Financial literacy

, 2

Financial planning

, 9

529 plan

, 293

Floating rate note

, 241

Forbes

, 177

Foreign exchange market

, 211

Foreign exchange transaction

, 397

Fortune

, 231, 278

401(k) plan

, 43

Framing bias

, 120

Fraud recovery fraud

, 187

Front-end load

, 339

Full-service broker

, 334

Fundamental analysis

, 128

Fundamental investing principles

, 140

Fundamental value

, 99

Fund flows

, 299

Fund of funds (FOFs)

, 59, 297, 353

Fund supermarket

, 340

Futures

, 210

Future shock

, 183

Gambler’s fallacy

, 114

Gambler’s ruin problem

, 400

Geometric mean

, 260

Glamour stock

, 268

Growth company

, 277

Growth investing

, 99

Growth stock

, 99, 268, 277, 296

Halo effect

, 153

Hedge fund

, 272, 349, 366

Hedging

, 349

Herd behavior

, 110

Herding

, 137

Herd mentality

, 65

Heuristics

, 117, 275

High frequency trading (HFT)

, 405

High risk investment

, 228

High-yield investment programs (HYIPs)

, 192

Hindsight bias

, 116

Holding limits

, 98

Home bias

, 125

Hot stock

, 269

Hulbert Financial Digest

, 422, 423

Hybrid fund

, 338

Ibbotson SBBI 2015 Classic Yearbook

, 45

Idiosyncratic risk

, 58

Illusion of control

, 404

Illusion of control bias

, 115

Illusion of inclusion

, 151

Illusion of knowledge

, 134, 151, 404

Inattention bias

, 132

Income stock

, 296

Incubated/limited distribution fund

, 312

Independent Financial Planning

, 17

Index funds

, 342

Indexing

, 79, 294

Index-linked bond

, 278

Index risk

, 294

Inflation risk

, 47, 257

Information advantage

, 400

Information processing biases

, 117

Informed investor

, 377

In-group bias

, 113

Initial public offering (IPO)

, 89, 203

Initial value

, 373

Insider trading

, 87, 155

Interest rate risk

, 48, 242, 295, 304

Interest rate swap

, 48

Intrinsic value

, 99

Investment advice

, 9

Investment club

, 414

Investment fraud

, 148

Investment plan development

, 139

Investment policy statement (IPS)

, 93

Investment strategy

, 98

Investment turnover

, 79

Jayenne 4

, 374

Junk bonds

, 49

Level load

, 340

Leverage

, 271

Leveraged ETFs

, 52

Life-cycle or target-date funds

, 296

Limited attention bias

, 124

Liquidity

, 95, 273

Liquidity risk

, 49, 239, 304

Load and no-load funds

, 338

Load funds

, 292

Loads

, 338

Local bias

, 125

Lock-up period

, 91

Longevity risk

, 44

Long-only positions

, 271

Long-only strategy

, 367

Long-short equity fund

, 366

Loss aversion

, 126, 265

Lottery scam

, 186

Lower costs of online trading

, 404

Low risk investment

, 228

Lulling payments

, 178

Margin

, 51

Margin account

, 334

Margin buying

, 51

Market capitalization

, 295

Market maker

, 405

Market risk

, 47, 239, 304

Mark to market

, 240

Mean reversion

, 267

Mental accounting

, 119

Microcap frauds

, 200

Microcap stock

, 198, 200

Million

, 194

Minibond

, 247

Misrepresentation

, 227

Momentum stocks

, 298

Money

, 318

Money market fund (MMF)

, 239

Monitoring

, 99

The Montel Williams Show

, 190

Mortgage-back security (MBS)

, 229

Mortgages

, 52

Mortgage underwriting

, 233

Multi-level or network marketing

, 157

Mutual fund

, 77, 289, 290, 336

Mutual fund prospectus

, 292

Naked call

, 51

Narrow framing

, 120

Negative or avoidance screening

, 408

Negativity bias

, 132

Net asset value (NAV)

, 240, 290, 383

Net exposure

, 367

The New York Times

, 65, 159

Noise trader

, 64

No-load fund

, 340

No-load mutual fund

, 292

Nominal return

, 45

Non-UCITS funds

, 306

One-time or shareholder fees

, 78

Ongoing expenses

, 338

Online trading

, 335, 403

Optimism bias

, 150

Option

, 334

Option account

, 334

Option premium

, 51

OTC market

, 200

Outcome bias

, 122

Outsmarting the Scam Artists

, 148

Overconfidence

, 403

Overconfidence bias

, 134

Panic selling

, 126

Participation rate

, 373

Passive investing

, 86

Passive management

, 79, 294

Pathway to Prosperity

, 193

Penny stocks

, 202

PE ratio

, 268

Performance of SRI mutual funds

, 409

Planning fallacy

, 19

Ponzi scheme

, 158

POP Finance

, 416

POP Finance: Investment Clubs and the New Investor Populism

, 416

Portfolio drift

, 60

Positive/affirmative screening

, 408

Precious metals

, 214

Preference shares

, 235

Preferred stock

, 235

Pre-IPO investment scams

, 203

Prepayment risk

, 295

Present bias

, 42

Price

, 372

Prime

, 192

Prime bank programs

, 206

The Prince

, 261

Private equity

, 273

Promissory note

, 207

Prospect theory

, 263, 264

Prospectus

, 251

Pump-and-dump scheme

, 198

Purchasing power risk

, 47

Pyramid scheme

, 157

R² or R-squared

, 303

Rational behavior

, 262

Real return

, 45

Rebalancing

, 60, 99

Rebalancing thresholds

, 98

Recency bias

, 122, 299

Regret aversion

, 129

Regular fund operating costs

, 78

Relativity trap

, 117

Representative bias

, 113

Representativeness heuristic

, 113

Retail investors

, 235, 363

Return

, 259

Return smoothing

, 57

Reverse convertible

, 378

Revertible note

, 378

Risk

, 261

Risk-averse

, 262

Risk capacity

, 96

Risk perception

, 264

Risk-return trade-off

, 261

Risk tolerance

, 95, 96

Robo-advisor

, 30, 332

Rudy Nutrition

, 201

Rules of thumb

, 117

Sales load

, 301

Satisficing

, 111, 264

Screening processes

, 407

Securitization

, 230

Selective attention

, 132

Self-attribution bias

, 135

Self-control bias

, 129

Self-deception bias

, 133, 135

Self-enhancing bias

, 135

Self-protecting bias

, 135

Self-serving bias

, 135

The 7 Secrets of Extraordinary Investors

, 32

Sharpe ratio

, 368

Short selling

, 271, 366

Short-termism

, 130

Sin stock

, 409

Social bias

, 110

Socially responsible investing (SRI)

, 407

Special purpose entity

, 248

Specific risk

, 47

SRI and conventional mutual funds

, 408

Standard deviation

, 54, 261

Status quo bias

, 131

Stock participation accreting redemption quarterly-pay securities (SPARQS)

, 380

Stocks for the Long Run

, 269

Strategic asset allocation

, 97

Strike price

, 50, 372

Structured note

, 364

Subordinated debt

, 236

Subprime

, 230

Sunk cost

, 127

Sunk cost fallacy

, 127

Survivorship bias

, 309

Swap

, 248

Swindling Billions: An Extraordinary History of the Great Money Fraudsters

, 148, 166

Systematic risk

, 47

Tax-loss harvesting

, 332

Technological Risk

, 7

Threshold-only strategy

, 61

Time-and-threshold strategy

, 61

Time-only strategy

, 61

Total return

, 259

Tracking error

, 388

Trap

, 2

UCITS

, 306

Underwriting

, 203

Unsystematic risk

, 47

USA Today

, 206

Utility

, 265

Value investing

, 99

Value stock

, 268, 296

Volatility

, 261

Wall Street Journal

, 108, 206

Window dressing

, 293

Wolf of Wall Street

, 199

Zero-sum game

, 399