Is “picking winners” actually a loser’s game?

admin Financial Life 201

For decades, Wall Street firms have marketed their ability to beat the market with their active investing strategies. The claim hinged on each firm’s ability to “pick winners,” stocks whose returns would beat the market’s. This market-beating ability would, in turn, justify the firms’ high fees. But in fact, active management rarely provides better investment results than what could be earned simply by …

Why We Don’t Use Active Funds

admin Financial Life 201

We’ve never believed that “actively managed” investments can reliably outperform index funds over longer-term timeframes. (NOTE: when we use the term index funds, we mean mutual funds and Exchange Traded Funds (ETFs).) Turns out, the evidence is on our side: over the past decade, the vast majority of actively managed funds – large-cap, mid-cap, and small-cap alike – underperformed their benchmark …