top of page

Two Index Fund Studies Remind Us of One Good Strategy

Writer's picture: Steve MartinSteve Martin

Index fund investors let the facts speak for themselves. The long-term data comparing active funds to index funds shows actively managed mutual funds underperform in all asset classes and all investment styles. There is no ambiguity in the results, and there’s nothing new to report here. The data has been saying the same thing for decades.

But, we’re only human. We forget, and lies are constantly being told that cause us to second-guess our resolve. It’s a good idea to revisit the data at least once a year just to remind ourselves why we believe what we believe: that we should continue to invest in index funds rather than active management.

I recommend two studies published annually to keep index fund investors on the straight and narrow. They are Vanguard’s The case for index-fund investing and S&P Dow Jones Indices’ year-end SPIVA® U.S. Scorecard. Both reports have been recently updated through year-end 2014, and together they’ll give you all the data needed to reconfirm that you’re doing the right thing by investing in index funds.

Vanguard’s Case

The case for index fund investing is a well-written, well-illustrated look at active versus passive investing, and it will only take about 30 minutes to read. Overall, it offers a detailed look at the theory behind indexing and includes comprehensive supporting data.

0 views0 comments

Recent Posts

See All

Avoid The Recency Pitfall

Larry Swedroe does a great job of talking about the importance of re-balancing.  Steve ============================================= Last...

Comments


Purposeful Financial and Legacy Planning

Fee-Only Financial Planning

(970) 443-1873

3400 Rosestone Ct, Fort Collins, CO 80525

  • Facebook
  • Twitter
  • LinkedIn

©2020 by Purposeful Financial and Legacy Planning

DISCLAIMER: This website is for informational purposes only and does not constitute a complete description of our investment services or performance. This website is in no way a solicitation or offer to sell securities or investment advisory services except, where applicable, in states where we are registered or where an exemption or exclusion from such registration exists. Information throughout this site, whether stock quotes, charts, articles, or any other statement or statements regarding market or other financial information, is obtained from sources which we, and our suppliers believe reliable, but we do not warrant or guarantee the timeliness or accuracy of this information. Nothing on this website should be interpreted to state or imply that past results are an indication of future performance. THERE ARE NO WARRANTIES, EXPRESSED OR IMPLIED, AS TO ACCURACY, COMPLETENESS, OR RESULTS OBTAINED FROM ANY INFORMATION POSTED ON THIS OR ANY 'LINKED' WEBSITE.

All domestic and international rights reserved. No part of this website, including text, graphics, et al., may be reproduced or copied in any format, electronic, print, et al., without written consent.

Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™ and CERTIFIED FINANCIAL PLANNER in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements.

bottom of page