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tony

Managed Funds That Beat Index Funds Over 17 Year Period

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If you you among those who believe that index funds/ETFs have proven themselves to be better performers than managed funds?

Like any in debate in which actual factual data can be examined to either help prove or disprove something, in the following article, extensive comparative performance results will be presented that will be hard for people who believe in the presumed inferiority of managed funds to explain. In fact, the results presented below, upon careful consideration, should be regarded as perhaps game-changing to what many investors have come to believe. So let's jump right into this data.

 

 

 

 

http://funds-newsletter.com/feb17-newsletter/feb17-new.htm

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Yes, but who could have known this with foresight?

 

If you were an investor in 2000, looking to put your money into managed funds, how could you have known that these were the funds to choose?

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Thats right profin GA

 

If we could choose the winning funds year in and year out we would not be recommending Index funds. But since we can't predict the winners with any level of consistency index fund gives you market returns and is the way you make more money. The financial industry hates index funds.

 

I have been through the managed fund deal and very few keep up their short term winning ways. They may outperform for a year or two but they always end up trailing the index over 5-10 years. Also they are usually not tax efficient. They spit out more taxable gains which further costs you. Not to mention managers changes which in itself can cause a managed fund to suddenly perform worse. I've experienced this too.

 

Now Vanguard managed funds have one big advantage and that is their managed fund fees are almost as low as their index fund counterparts which makes them competitive . This is not common in the mutual fund industry. Also Vanguard in some of their managed funds have multiple management companies manage certain percentages of the fund. This is good for accountability. Very smart and keeps a fund performing consistency.

 

Now thats not to say an index fund can't falter if the market falters. So thats why you diversify into bonds and cash.

 

Tony

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