 Good day, fellow investors! We continue with our summary of Ben Graham's The Intelligent Investor. Here it is, great book. I think it's the key book for investors, especially those who want to learn and invest for the long term. And today we'll discuss Chapter 9, investing in mutual funds, investing in investment funds. The first note is that index funds didn't really exist when Graham wrote the book, so just 50 years ago index funds didn't exist. And that's something to keep in mind, because index funds are a new product. Vanguard index funds were founded in 1976 and didn't get any traction until the beginning of the 1980s. And that's exactly when interest rates started to go straight down. So index funds have benefited from declining interest rates that raise asset prices. And that's something to keep in mind over the long term. We'll discuss what Graham discusses about funds and investing in funds and then try to put his perspective in the modern age. He's not against, I think he would not be against investing in index funds, SAP500 and so, but there is always a way to do that, which is coherent to what Graham has been saying in the past videos. The first thing that Graham didn't have is 0.04% commission index funds. In Graham's times, funds had entry fees of 9% and then huge management fees, 220 was a bargain then. So he simply says that that's too much and the only way you can, you should invest in such funds is to invest in closed-end funds at a bargain, at a discount to net asset value. A closed-end fund where people cannot really invest more is a fund like Berkshire. So there is no new money coming in. So when that trades at a discount to net asset value, then you invest in Berkshire. People that have invested in 2009 did very well with Berkshire. Another fund that is trading now like that is Berkshink from Bill Ackman that I have discussed in a video. So that's also an idea because then yes, they have their fee, but you're already buying something at the margin of safety at the discount, which is how Graham loves to invest. One thing that he discusses and he gives us this quote, I don't know how to say it in French, but it means the more it changes, the more it is the same. And that's the human attitude to jump in on a train that's doing well. When an fund is doing good, good, rising, rising, rising, people start when it goes higher, putting more and more money into that fund, which gives it further strength to go higher and higher. But that can be sustained as long as people continue to put money in it. And that's exactly what I think is my perspective on index funds. They have been doing good over the past 45 years. People are now brainwashed to invest only there, there, there, and they keep doing good and keep beating everything else. As long as that will be the case, they will keep going up. There is nothing we can do about it. However, whether Graham would invest in index funds, that is always depending on only one thing for Graham, risk, reward, interest rates. We see that the price earnings ratio of the SAP 500 is 25, implying an earnings yield of 4%. Two-year treasury bond yields 2.57% at no risk. So what would Graham say? As always, he says, keep 25% to 75% in stocks or bonds. When stocks are expensive, 25% in stocks, 75% in bonds. When bonds are expensive or stocks are cheap, 75% in stocks and 25% in bonds. And if you rebalance there, according to the interest rate to the risk of the market and you do that over the long term, you will reach a great return over the long term and you will be a great investor. And you don't even have to think a lot. And yes, you can use index funds to do that. However, the message of the market where you should put everything now in index funds and forget about it, that's something plainly stupid. And that's my message. And that's what I think Graham would agree, because in his book constantly he discusses how in the 1970-71, the Dow Jones index is too expensive to be crazy invested in the index. And he was right because it really dropped for the next 10 years. And I think in 1980, if he would have written another book in the 1980s, he would be crazy and he would say, buy, buy, buy all those stocks at price earnings ratio of 8, 9 when the price earnings was 20, just 10 years prior to that. So rebalance, if you're a defensive investor, rebalance between stocks and bonds and you will do well over time. That's Graham's message. And I think you will agree that that is Graham's message. Thank you for watching. Looking forward to your comments. Look, as always, at value to this thread by your great comments. See you in the next video.