The Little Book of Common Sense Investing

Question 1

the Oracle of Omaha

Answer 1

a person or book that gives valuable advice or information

Question 2

It is a book about the perils of relying on a fund’s past performance.

Answer 2

the fact of something being dangerous or harmful

Question 3

The tyranny of compounding investment costs.

Answer 3

unfair or cruel use of power or authority
暴政

Question 4

The magic of compounding is little short of a miracle.

Answer 4

used when you are saying that something is almost true, or is equal to something
(also nothing short of)

Question 5

“the relentless rules of humble arithmetic”

Answer 5

not stopping; not getting less strong

Question 6

As a group - I hope you’re sitting down for this astonishing revelation - we investors are average. For each percentage of point of extra return above the market the one of us earns, another of our fellow investors suffers a return shortfall of precisely the same dimension.

Answer 6

1. the act of making something known that was secret, or a fact that is made known
2. if there is a shortfall in something, there is less of it than you need or expect

Question 7

With all that feverish trading activity, the only sure winner ~

Answer 7

showing strong feelings of excitement or worry, often with a lot of activity or quick movements ; unnaturally excited or active

Question 8

~ it will usually be the managers who reap outsize profits, not the clients.

Answer 8

1. reap something: to obtain something, especially something good, as a direct result of something that you have done (收割)
2. larger than the usual size

Question 9

In the game of investing, the financial croupiers always win, and investors as a group lose.

Answer 9

a person whose job is to be in charge of a game in a casino and collect and pay out money, give out cards, etc. 荷官

Question 10

After the deduction of the costs of investing, beating the stocking market is a loser’s game.

Answer 10

the process of taking an amount of something, especially money, away from a total; the amount that is taken away

Question 11

Mutual fund investors, too, have inflated ideas of their own omniscience.

Answer 11

1. believing or claiming that somebody/something is more important or impressive than they really are.
2. the quality of knowing everything.

Question 12

Oblivious of th toll taken by costs, too many fund investors willingly pay heavy sales loads and incur excessive fund fees and expenses, and are unknowingly subjected to the substantial but undisclosed transaction costs incurred by funds as a result of their hyperactive portfolio turnover.

Answer 12

1. not aware of something
2. money that you pay to use a particular road or bridge
3. a commission that you pay to an advisor or broker who sells you a mutual fund
4. if you incur costs, you have to pay them.

Question 13

Firms with flawed ideas and rigid strategies and weak managements ultimatlely fall victim to the creative desctruction that is the hallmark of competitive capitalism, only to be succeeded by other firms.

Answer 13

very strict and difficult to change (disapproving)

Question 14

But in the aggregate, businesses have grown with the long-term of our vibrant economy.

Answer 14

1. added together as a total or single amount
2. full of life and energy

Question 15

I assum that this long-term relationship will prevail in the years ahead.

Answer 15

1. to exist or be very common at a particular time or in a particular place
2. further forward in space or time; in front

Question 16

Because during the past decade they have raked in something like $565 billion each year from you and your fellow investors.

Answer 16

to earn a lot of money, especially when it is done easily

Question 17

The arithmetic on which the investing philosophy is based is irrefutable.

Answer 17

that cannot be proved wrong and that must therefore be accepted

Question 18

So long as we investors accept the status quo of today’s crazy-quilt financial market system, so long as we enjoy excitement of buying and selling stocks, and so long as we fail to realize that there is a better way, such a philosophy will seem counterintuitive.

Answer 18

1. since; to the extent that
2. the situation as it is now, or as it was before a recent change
3. ?? just google it

Question 19

It may seem farfetched for me to hope that any single book could ignite the spark of a revolution in investing.

Answer 19

1. very difficult to believe
2. to start to burn; to make something start to burn
3. an action or event that causes something important to develop, especially trouble or violence

Question 20

Perhaps the sentiments contained in the following pages are not yet sufficiently fashionable to procure the general favor; a long habit of not thinking a thing wrong, gives it a superficial appearance of being right, and raises at first a formidable outcry in defence of custom.

Answer 20

1. a thought, opinion, or idea based on a feeling about a situation, or a way of thinking about something
2. following a style that is popular at a particular time
3. to obtain something, especially with difficulty
4. if people, things or situations are formidable, you feel fear and/or respect for them, because they are impressive or powerful, or because they seem very difficult
5. a reaction of anger or strong protest shown by people in public
6. the act of protecting somebody/something from attack, criticism, etc.

Question 21

the very fabric of our society

Answer 21

the structure or parts of something

Question 22

experts who have no axe to grind except for the truth about investing.

Answer 22

have an axe to grind: to have private reasons for being involved in something or for arguing for a particular cause

Question 23

Bogle’s reasoned precepts can enable a few million of us savers to become in twenty years the envy of our suburban neighbors – while at the same time we have slept well in these eventful times.

Answer 23

1. presented in a logical way that shows careful thought
2. a rule about how to behave or what to think
3. full of things that happen, especially exciting, important or dangerous things
4. a period of history connected with particular events or experiences in people’s lives

Question 24

You will also earn your fair share of any interim negative returns.

Answer 24

intended to last for only a short time until somebody/something more permanent is found

Question 25

folksy parable

Answer 25

simple, friendly and informal

Question 26

Each family member grew wealthier at the same pace, and all are harmonoius.

Answer 26

1. the speed at which something happens
2. friendly, peaceful and without any arguments

Question 27

…the family’s share of the generous pie that U.S. industry bakes each year, 100 percent at the outset, starts to decline…

Answer 27

at/from the beginning of something

Question 28

They recognize that their foray into stock-picking has been a failure, and conclude that they need professional assistance,…

Answer 28

an attempt to become involved in a different activity or profession

Question 29

So when the family appraises its wealth a year later, it finds that its share of the pie has diminished even further.

Answer 29

to consider or examine somebody/something and form an opinion about them or it

Question 30

To make matters still worse, the new managers feel compelled to earn their keep by trading the family’s stock a feverish level.

Answer 30

1. to force somebody to do something; to make something necessary
2. to be worth the amount of time or money that is being spent

Question 31

Undeterred by their two previous failures, they decide to hire still more Helpers.

Answer 31

if somebody is undeterred by something, they do not allow it to stop them from doing something

Question 32

They retain the best investment consultants and financial planners…

Answer 32

to keep something; to continue to have something

Question 33

Alas, with those added costs, the family’s share of the pie tumbles once again.

Answer 33

1. used to show you are sad or sorry
2. to fall rapidly in value or amount

Question 34

Alamed at last, the family sits down together and takes stock of the events that have transpired since some of them begin to try to outsmart the others.

Answer 34

1. after much delay, effort, etc.; in the end
2. If it transpires that something has happened, this previously secret or unknown fact becomes known.

Question 35

When a business is conducted in a way that directly defies the interests of its clients in the aggregate, it is only a matter of time until the clients awaken to reality.

Answer 35

1. to refuse to obey or show respect for somebody in authority, a law, a rule, etc.
2. used to say that something will definitely happen, although you are not sure when

Question 36

In terms that are a bit less contentious

Answer 36

likely to cause people to disagree

Question 37

When greed hold away, very high P/Es are likely.

Answer 37

take control, hold power or influence over somebody

Question 38

They momentarily derail the steady long-range upward trend in the economics of investing.

Answer 38

1. for a very short time
2. de(偏離)rail(軌道)
3. long-range 長程

Question 39

Compounding these returns over 116 years produces accumulations that are truely staggering.

Answer 39

so great, shocking or surprising that it is difficult to believe

Question 40

To understand why past returns do not foretell the future, we need only heed the words of the great British economist John Maynard Keynes.

Answer 40

1. to know or say what will happen in the future, especially by using magic powers
2. to pay careful attention to somebody’s advice or warning

Question 41

The tumble in stock market prices give us our comeuppance.

Answer 41

1. to fall downwards, often hitting the ground several times, but usually without serious injury; to make somebody/something fall in this way
2. a punishment for something bad that you have done, that other people feel you really deserve

Question 42

Way back in 1320, William of Occam nicely expressed the virtue of simplicity, essentially setting forth this precept: When there are multiple solutions to a problem, choose the simplest one.

Answer 42

1. carefully; exactly
2. to start a journey
3. a rule about how to behave or what to think

Question 43

GIven the simplicity of these two portfolios, it is hardly surprising that the two indexes earned returns that are in lockstep with one another.

Answer 43

a situation where things happen at the same time or change at the same rate

Question 44

Yes, ther are variations over the interim periods: the S&P 500….

Answer 44

Intended to last for only a short time until somebody/something more permanent is found

Question 45

The recent era not only has failed to erode, but has nicely enhanced the lifetime record of the world’s first index fund.

Answer 45

to gradually destroy something or make it weaker over a period of time; to be destroyed or made weaker in this way

Question 46

At a lunchon on September 20, 2016, celebrating the 40th anniversary of the fund’s initial public offering, the counsel for the fund’s underwriters reported that he had purchased 1,000 shares at the original offering price.

Answer 46

1. a formal lunch or a formal word for lunch
2. 法律顧問
3. 承銷商

Question 47

Now, there’s a number that requires no embellishment.

Answer 47

the addition of details to make a story more interesting, even if the details are not true
(a decoration or other addition that is intended to make something more beautiful or interesting)

Question 48

Instead of joining the crowd of investors who dabble in complex algorithms or other mechinations to pick stocks, or who look to past performance to select mutual funds or who try to outguess the stock market (for investors in the aggregate, three inevitably fruitless tasks), choose the simplest of all solutions.

Answer 48

1. to take part in a sport, an activity, etc. but not very seriously
2. a secret and complicated plan (disapproving)
3. producing no useful results

Question 49

Over the fifteen years ending 1998, a minuscule 4 percent of mutual funds produced market-beating after-tax results with a scant 0.6 percent.

Answer 49

1. extremely small
2. hardly any; not very much and not as much as there should be

Question 49

Indexing is also the predominant strategy for largest plan of them (several pension funds) all.

Answer 49

having more power or influence than others
(most obvious or easy to notice)

Question 50

But after we pay our financial intermediaries, we pocket only what remains.

Answer 50

1. a person or an organization that helps other people or organizations to make an agreement by being a means of communication between them
2. to earn or win an amount of money

Question 51

But then add agiant addditional cost, all the more pernicious by being invisible.

Answer 51

having a very harmful effect on somebody/something, especially in a way that is not easily noticed

Question 52

Brandeis, later to become one of the most influential jurists in the history of U.S. Supreme Court, railed against the oligarchs who a century ago controlled investment America and corporate America.

Answer 52

1. a person who is an expert in law
2. to complain about something/somebody in a very angry way
3. 寡頭

Question 53

Brandeis described their self-serving financial management and their interlocking intersets as “trampling with impunity on laws human and divine, obsessed with the delusion that two plus two make five”.

Answer 53

1. to fit or be fastened together securely
2. to ignore somebody’s feelings or rights and treat them as if they are not important
3. the fact of not getting punished for something
4. a false belief or opinion about yourself or your situation

Question 54

Brandeis’s works hit me like proverbial ton of bricks.

Answer 54

1. like a ton of bricks:very heavily; very severely
2. used to show that you are referring to a particular proverb or well-known phrase

Question 55

It’s been said by detractors that all I have going for me is “the uncanny ability to recognize the obvious.”

Answer 55

1. a person who tries to make somebody/something seem less good or valuable by criticizing them/it
2. strange and difficult to explain

Question 56

Indeed, the self-interest of the leaders of our financial system almost compels them to ignore these relentless rules.

Answer 56

to force somebody to do something; to make something necessary

Question 57

By and large, these managers are smart, well-educated, experienced, knowlwdgable, and honest.

Answer 57

used when you are saying something that is generally, but not completely, true

Question 58

when investors focus on short-term returns, ignoring the truely confiscatory impact of costs over an investment lifetime.

Answer 58

used to describe the act of something being taken away from someone by a government, etc.:

Question 59

and then continues to invest over an actuarial life expectancy of 20 or more years thereafter.

Answer 59

1. actuary: 精算
2. after the time or event mentioned

Question 60

Simply put, our fund managers have confiscated an excessive share of returns delivered by our financial market.

Answer 60

to officially take something away from somebody, especially as a punishment

Question 61

In short, the humble arithmetic of investing - the logical, inevitable, and unyielding penalty assessed by investment costs - has devastated the returns earned by mutual fund investors.

Answer 61

1. if a person is unyielding, they are not easily influenced and they are unlikely to change their mind
2. to completely destroy a place or an area

Question 62

our mental fund marketers are foisting that delusion on investors.

Answer 62

1. a person or business whose job is to present, advertise and sell a company’s products in the best possible way
2. foist on: to force somebody to accept somebody/something that they do not want

Question 63

Realize that you are not consigned to playing the hyperactive management game that is played by overwhelming majority of individual investors and mutual fund owners alike.

Answer 63

To get rid of someone or something or to put him, her, or it in an unpleasant place or situation