It has been recently wagered by Warren Buffet that he will do better in his investment returns than a group of hedge fund managers will by investing in a passive index fund. The wager is for $1 million and it looks like he stands to gain on this one.
Buffet strongly believes that there are just too many expensive and mediocre funds that simply shortchange their investors. Buffet has an approach to investing that adopts a bottom-up tactic that has been proven to be quite effective over the years. Buffet is known to deliver a clear message that Americans need to save for retirement and to get and stay invested and more information click here.
In his recent shareholder letter, Buffet offered some very valuable wisdom on investing. He advises that it is best to stay wary of product labels and to be aware of funds that are expensive an will eat into your investments over time. Passive index funds especially can be known to give poor returns because of their high costs and excessive trading. You want to instead invest in funds that keep costs low and where the fund manager is as equally invested and learn more about Timothy.
Passive index returns are not the safe bet but rather they have their place. They typically do not offer any cushion against downturns. Only about half of the 1200 investors surveyed online the previous year were even aware that index funds are exposing them to 100 percent of the losses and risks during market downfalls. It is better to do better than most investors in bad tomes in order to grow your nest egg and resume him.
The key to a good investment return is to invest in a fund that’s not overpriced and is one that the fund manager is as equally invested in. This will result in a group of investors that will outpace benchmark indexes and Tim’s lacrosse camp.
Timothy Armour has been investing for Capital Management Group for 34 years and is the chairman of the company. He has a bachelor’s degree in economics and attended Middlebury College. He is based out of Los Angeles and is an equity portfolio manager.
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