Quote:
Originally Posted by masraum
I like indexed funds, not active funds where some expert thinks he knows how to beat the market. Even if the "market" made 10% and the active investor made 11.5 or 12% over time, that extra return would probably be completely consumed by the fees paid to that expert to beat the market.
The fees on good index funds will probably run .05-.2% while the fees on the active funds will probably run 1-3.5%. Yeah, that's a BIG difference, especially over time and large sums.
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I've never followed this line of thinking. If after all fees and charges a managed fund consistently beats the index fund why would I want to put my money in the index? Look up these two managed funds (PYSCX and PVSCX) and compare them to a low cost Vanguard S & P index ETF (VOOV) over the past 5 years. Why wouldn't I pick the managed fund? Sometimes the best costs more. What do I care as long as I end up with more in my pocket?