How to Smell a Rat

KEN FISHER is the Founder, Executive Chairman, and Co-Chief Investment Officer of Fisher Investments, a $387-plus billion (as of 3/31/2026) investment adviser and money management firm serving large institutions and high-net-worth individuals. For over 32 years, Fisher wrote Forbes' "Portfolio Strategy" column, making him the longest continuously running columnist in the magazine's venerable history. He now writes monthly, native-language columns in over 25 major media organs worldwide, including the New York Post, Britain's Daily Telegraph, Spain's elEconomista and Italy's Il Sole 24 Ore. In total, his columns span more countries and more languages in more total reach than any other, non-syndicated columnist of any type ever.LARA HOFFMANS graduated from the University of Notre Dame with a BA in theatre. She is a content manager at Fisher Investments and contributing editor of MarketMinder.com. She also coauthored with Ken Fisher the bestsellers The Only Three Questions That Count and The Ten Roads to Riches.

With five straightforward rules that would have saved any investor from Bernie Madoff, investment firm CEO and Forbes columnist Fisher (100 Minds That Made the Market) gives readers a secure plan for fraud-proof investing, worthwhile for novices and sophisticated financiers alike. Using the example of everyman “Jim,” a precarious investor navigating shark-filled waters, Fisher presents a clear, fast-paced, tightly organized guide to principles like “Too good to be true usually is,” and “Due diligence is your job, no one else's.” Fully-referenced data, insider details, laser-focused statistical digressions, and the finer points of practical investing keep pages turning. Readers will value the practical, easy-to-follow models of solid, transparent investment strategies and examples from Fisher's experiences as CEO of his own investment firm. Fisher also includes suggestions for further reading and appendices that reproduce previously-published comparisons of different asset allocations, information for small business owners and short biographies of market-movers. Much more than what to avoid, Fisher’s concise guide should be highly illuminating and confidence-building for anyone with a bank account. (Aug.) Starred review (Publishers Weekly, September 2009) Using well-known examples from recent headlines like Bernard Madoff and R. Allen Stanford along with a bevy of historical scam artists, Fisher details the red flags that should alert investors. They are: advisers who have access to your money; promises of returns that are too good to be true; mumbo-jumbo that takes the place of explaining investing strategy; fake benefits like exclusivity, and relying on someone else for due diligence. (Associated Press)

• Acknowledgments viiIntroduction 1Chapter 1: Good Fences Make Good Neighbors 11Chapter 2: Too Good to Be True Usually Is 39Chapter 3: Don’t Be Blinded by Flashy Tactics 63Chapter 4: Exclusivity, Marble, and Other Things That Don’t Matter 87Chapter 5: Due Diligence Is Your Job, No One Else’s 111Chapter 6: A Financial Fraud–Free Future 137Appendix A: Asset Allocation—Risk & Reward 153Appendix B: Same but Different—Accounting Fraud 157Appendix C: Minds That Made the Market 161Notes 195Index 203About the Authors 209