Wednesday 30 November 2011

Book Review: No Hype, second edition by Gail Bebee

Almost four years ago, I reviewed the first edition of Bebee's No Hype book and gave it a high (by my standards) rating. The just-released second edition contains essential updates and excellent refinement of specific portfolio suggestions, which is probably what readers want most. The most notable addition is a new section on TFSAs, though there are also many revisions to organization names, website links, addresses etc that make the book practically useful for investors today.

There has also been reordering of material, such as moving the discussion of annuities into the retirement chapter alongside RRSP sections, addition of many more links and references to online resources, such as a list of useful blogs, (including my own I gratefully acknowledge!). Most of the links are available on her website under Resources.

The Asset Allocation and Portfolio Building material has the most interesting updates.
  • real return bonds added as a component of the fixed income asset class; they now get included as part of all suggested portfolios
  • revisions (mostly downward) to guidance on what rate of return to expect, based on historical averages, as well as addition of figures for several very useful asset classes - Canadian vs US bonds, Canadian vs US vs Emerging Market stocks, real estate; all this allows better estimation of what various portfolios will yield and will be very useful as more and more investors are taking to the idea of diversifying beyond Canada
  • completely ETF sample portfolios specified right down to percentage sub-divisions within asset classes e.g. 35% equities in the Large Income Focused portfolio broken down to 20% iShares S&P TSX 60 Index (XIU) and 15% Claymore Global Monthly Adv Dividend (CYH)
  • all-in-one single mutual funds or ETFs that suffice as a good-enough ultra-simple portfolio solution
  • one non-update is that the individual stocks suggested for the equities allocation in larger portfolios have pretty well remained the same; Bebee's picks from four years ago still seem to be holding strong!
Caveats: There are a few niggling typos and minor errors such as: the Balanced Portfolio in Fig. 25.2 that only adds up to 95% (it looks like the 5% Foreign Bonds that was in the 2008 edition got deleted; Fig. 10.1 confirms this supposition); some of the ETF tickers do not match the fund name e.g. in the Income Focused Portfolio the iShares S&P TSX 60 Index ETF has the XIC ticker when it should be XIU. I could not find, as the preface promises, expanded material, though there are updates in chapter 8, on how to resolve problems with financial service providers - was I looking in the wrong place?

To make this book even more convenient for the investor, maybe the next edition could combine the advice on what goes in RRSP vs TFSA along with sample portfolios e.g. take one of the more elaborate portfolios, like the ETF Growth Portfolio, which has 11 separate holdings, and lay out what should go where. For example, I just did this post - ETF Asset Allocation Across RRSP, TFSA and Taxable Accounts - about this topic on my other blog.

This book has established itself as a fine beginner's guide to investing that successfully bridges the challenge of a "good-enough" compromise between the practical simplicity that people will actually read and use and the ideal complete perfection of a thousand page brick that almost nobody would read or be able to apply.

Gail Bebee's website takes orders for the book directly, though it's also available from

My rating creeps up from its first edition four to 4.5 out of 5.

Disclosure: Gail Bebee provided me with a draft of the second edition (and a copy of the published version too - thanks Gail!) and I submitted comments and suggestions to her, some of which have been incorporated into it.

1 comment:

Anonymous said...

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