Book Review: Explore TIPS

Last Updated Nov 29, 2010 10:41 AM EST

One of the most prominent members of the Bogleheads Investment Forum goes by the moniker "The Finance Buff" and has written an excellent manual to investing in Treasury Inflation-Protected Securities titled Explore TIPS.

The book is a practical guide for the retail investor. It's written in clear and simple terms that even a bond novice should be able to follow. The author makes an important contribution, as there are few good books on investing in bonds and none devoted solely to TIPS. Besides my book The Only Guide to a Winning Bond Strategy You'll Ever Need, I know of only two others I would recommend.
My book The Only Guide to Alternative Investments You'll Ever Need includes a chapter on TIPS. However, Explore TIPS provides you with not only the reasons to consider investing in TIPS, but also all you'll ever need to know about how to invest in them. The author tells you how to buy and sell individual TIPS either directly from the Treasury or in the secondary and provides the pros and cons of each. He also tells you how to invest in TIPS indirectly through a mutual fund or an ETF. Again, he provides the pros and cons of each and lists the alternative vehicles, including their expense ratios.

While the book contains less than 130 pages, don't let its short length mislead you. It demystifies the world of TIPS and provides what you need to know to make good investment decisions. Whether you're going to invest in individual TIPS or buy them through a fund, you should read this book before investing.

More on MoneyWatch:
TIPS Update for November With TIPS, Should You Buy, Hold or Sell? Why the Concern over Negative TIPS Yields Is Overblown How to Build a Bond Portfolio Who's Smarter: Active or Passive Investors?
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    Larry Swedroe is director of research for The BAM Alliance. He has authored or co-authored 13 books, including his most recent, Think, Act, and Invest Like Warren Buffett. His opinions and comments expressed on this site are his own and may not accurately reflect those of the firm.