Financial professional Larry Swedroe joins the show to talk about the best ways to invest in the stock market in episode 24 of the YMYW podcast. He compares passive and active investing, explaining which approach is best for pre-retirees and retirees. Original publish date April 23, 2016 (hour 2). Note that content may be outdated as rules and regulations have changed.

00:00 - Intro

01:27 “If you’re at all interested to figure out what’s going on in the overall markets, we’ll get a recap of the first quarter, we can talk about active management versus passive management and we’ll talk about different ways to construct your overall portfolio”

05:41 “When it comes to finance you have to look at the longest time period available because you can manipulate the data a little bit if you pick and choose what time frames you’re measuring performance on”

07:24 Start of Interview with Larry Swedroe

08:23 “Let’s go over real quickly this active versus passive debate”

08:46 “He [Eugene Fama, Nobel Prize winner] defines ‘active’ as those who are engaged in individual stock selection and/or market timing”

11:24 “Any decision to own any asset allocation that’s different from the market is an active decision in terms of your strategy”

14:19 “You have to be prepared to accept long periods and stay the course”

15:48 “The market is getting smarter and it’s getting harder to outperform the market itself”

16:21 “Because the market and investors are getting more intelligent, do you think these risk premiums would ever go away?

21:52 “Ignore the ups and downs of the market, and if anything be a rebalancer which means you’re going to buy when everyone else is panic selling”

26:34 “People’s focus on dividends is a purely psychological one”

30:41 End of Interview with Larry Swedroe

31:28 “When you take a look at the markets, there’s a lot of noise and there’s a lot of information out there…you have to find the academic studies first and foremost to figure out exactly what makes sense, versus [turning towards] opinions and forecasts”

35:05 “One of the biggest things you want to look at in retirement is very low volatility in the overall portfolio”