What is Lifecycle Investing?
Asset diversification has long been heralded as the safe way to invest. That’s why you buy index funds. What if this isn't the only way to diversify? Lifecycle Investing develops a strategy to better spread risk over your working lifetime—that is, diversifying over time. Time diversification makes it possible to earn the same return with lower risk or a higher return for the same risk.
Our video interview below provides an overview of Lifecycle Investing. (You'll find additional videos here.) You can find out more about the book, read an excerpt, and explore our data to see the results for yourself.
"A most provocative book. The real advantages of time diversification have never been laid out so clearly or with such a program of action."
—Robert J. Shiller, author of Irrational Exuberance
"Here are the chief investment lessons of the financial crisis for today’s young people: they should be buying more shares and running up debts to do so. ...[T]here is nothing intrinsically risky about regular borrowing to get that fund off to an early start. ... Not only does the concept make sense, it has paid off in the past. ... Ayres and Nalebuff have looked at historical stock market data. ... For every single cohort, the early leverage strategy beat the conventional wisdom."
—Tim Harford, Financial Times
"This bold book promotes more early equity exposure for the masses, precisely at a time when many practitioners are re-thinking the 'buy and hold stocks for the long run' mantra. Whether you are comfortable with this strategy or not, the book is a must read for anyone who claims to think about their personal finances in a rigorous and logical manner."
—Moshe A. Milevsky, Ph.D.
Finance Professor, York University, and author of Are You a Stock or a Bond?