Why index investing is taking off
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Index investing is a way of gaining market returns for the least cost.
Active managers often cannot consistently outperform their relevant index. They have relatively higher fees and lower diversification compared with an index fund.
Our blog on SPIVA shows how the majority of active managers underperform their relevant index.
The award winning British video series ‘How to Win the Loser’s Game’ investigates why there is a move to investing in index funds. The video clip below (2 minutes) is an introduction to this series.
Part 3 is a particularly interesting video of the 10 part series. It delves into the general long term under performance of fund managers.
Our blog under the news section, Fund managers rarely outperform the market for long is an article from The Economist from a slightly different perspective.