David Booth pioneered index investing. Here's his advice for investors..

David Booth, a billionaire index investing pioneer and the founder of Dimensional Fund Advisors, advises investors to stay calm and keep investing in volatile markets. His new book, "Stay Calm: Learn to Embrace Uncertainty in Investing and Life," published on September 1, shares this message along with insights on the power of being an outsider in investing and the lessons investing can teach about living.

Booth studied under Eugene Fama, a Nobel laureate, at the University of Chicago, where he learned about the efficient market hypothesis, which supports index investing. He explains that research shows stocks, on average, return about 9% a year, while most active managers fail to match the market after fees. Booth emphasizes that investors should accept market uncertainty instead of trying to outsmart it.

The author discusses why passive investing, which aims for broad market diversification at low fees, has emerged as a popular approach. He notes that while actively managed funds tend to lag the market, index funds offer a simple and cost-effective way for everyone to benefit from the market's long-term returns, which have consistently been high. Booth argues that the high returns are a reward for taking risk, driven by human ingenuity and our ability to adapt and overcome challenges.

Booth also addresses the fear and anxiety many investors feel today, comparing it to historical periods of uncertainty like the Great Depression. He stresses that the market doesn't offer do-overs and encourages investors to stay invested, even when markets decline, to avoid missing out on significant gains. In his book, Booth explores how investing can teach valuable life lessons about managing uncertainty and staying resilient in the face of challenges.