📖John Bogle
Risk-First Approach
Consider the downside before the upside.
Before considering how much you can make, consider how much you can lose. Risk management is not about avoiding risk entirely, but about understanding and controlling it.
🏠 Everyday Analogy
📖 Core Interpretation
John Bogle treats survival as the first objective. Limiting permanent capital loss, controlling leverage, and avoiding single-point failure are prerequisites for long-term compounding.
💎 Key Insight：Risk management is about understanding, not avoidance.
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❓ Why It Matters
A single large drawdown can erase years of progress. Risk control is not timidity; it is the operating system that keeps compounding alive.
🎯 How to Practice
Define downside scenarios before entry, cap position size, avoid fragile leverage, and maintain liquidity so mistakes remain survivable.
⚠️ Common Pitfalls
Equating volatility with all forms of risk
Oversized positions without an exit plan
Using leverage to compensate for uncertainty
📚 Case Studies
1
Index Investors Through the Global Financial Crisis (2008)
During the 2007–2009 financial crisis, global stock markets plunged over 50%. Many investors panicked, sold stocks, or chased tactical strategies. Long-term index investors in low-cost total market funds who stayed fully invested endured severe temporary drawdowns but made no drastic changes.
✨ Outcome：By 2013, the S&P 500 had recovered to new highs and kept compounding thereafter. Those who simply held broad index funds with low fees and stayed the course generally beat investors who bailed out or traded heavily, underscoring Bogle’s simplicity doctrine.
2
Vanguard 500 vs. Janus Twenty in the Tech Bubble (2000)
In the late 1990s, Janus Twenty, a concentrated growth fund heavy in tech, dramatically outperformed the broad-market Vanguard 500 Index Fund. Investors poured billions into Janus based on its stellar recent returns, while the plain-vanilla index fund looked dull and lagging.
✨ Outcome：After the 2000–2002 tech crash, Janus Twenty’s performance collapsed and badly trailed the S&P 500 over the full cycle. The once-mediocre index fund pulled ahead, illustrating Bogle’s point that hot funds often cool and revert toward market averages.
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