Warren Buffett — 1996 annual letter to shareholders

The purpose of this website is to provide a free and unbiased educational tool to empower individuals who have little or no knowledge of the investment world, on how to invest money through Index Funds. This website is not espousing any new investment theories, on the contrary, it is relying on the knowledge of two universally recognized investment giants: Warren Buffett and John Bogle. Their message is simple, as John Bogle put it: Invest consistently and for the long haul in a widely diversified portfolio of stocks and bonds. Pay attention to taxes and costs. But leave your investments alone. The reason why Buffett and Bogle recommend Index Funds are:

1) SIMPLICITY — Index Funds are easy to understand and the simplest way to own stocks and bonds.

2) COST — Index Funds are the least expensive way to own stocks and bonds.

3) DIVERSIFICATION — Index Funds are the easiest way to diversify your investments in stocks and bonds.

4) PERFORMANCE — Index Funds consistently outperform actively managed funds.

Wall Street doesn’t promote Index Funds because it makes very little money off of them. Instead, it fools you into thinking that investing requires specialized knowledge and complicated math. This way they can rationalize charging investors 10 to 20 times more than Index Funds do. As Warren Buffett stated:If calculus or algebra were required to be a great investor, I’d have to go back to delivering newspapers. As you are about to find out in this website, investing through Index Funds is very simple and doesn’t require a lot of specialized knowledge, money or time. Even if you are only in the position to start investing $20 per month, this website will teach you all the knowledge you need to invest successfully for the long term using Index Funds. What makes this website different from all the other investment websites out there is:

1. It’s free and unbiased. Basics of Investment does not receive commissions, referral fees or advertising dollars.

2. It’s made for people with little or no knowledge of the investment world, therefore, it is designed so the reader follows a single path. Other websites have a number of sections on their home page but if you know little or nothing about investing, how do you know where to start? Here, you simply keep on scrolling downwards.

3. Investing concepts and terms are introduced as needed and are explained in a simple manner without using complicated math or formulas.

4 . This website will first teach you about the individual parts of investing. Then it teaches you how to put the parts together to create a long term investment plan. Lastly, it will provide you with direct links to the best Index Funds allowing you to open accounts directly with them to start your investment plan.

5. If you have any questions or doubts, you can set up an appointment to discuss them over the phone for free. Just click on CONTACT at the top of the page to set up your free appointment.

The stepping stones in this website are as follows:

The most powerful concept in investing