Thoughts and observations for those investing on their own or contemplating doing it themselves.
If you are seeking investment help, look at the video here on my services. If you are seeking a different approach to managing your assets, you have landed at the right spot. I am a fee-only advisor registered in the State of Maryland, charge less than half the going rate for investment management, and seek to teach individuals how to manage their own assets using low-cost indexed exchange traded funds. Please call or email me if interested in further details. My website is at http://www.rwinvestmentstrategies.com. If you are new to investing, take a look at the "DIY Investor Newbie" posts here by typing "newbie" in the search box above to the left. These take you through the basics of what you need to know in getting started on doing your own investing.
Saturday, October 9, 2010
Active vs. Passive - It Ain't Going Away
Most people in the active versus passive debate know the importance of framing. Just saying "passive" along with a disgusting look can go a long way for the naysayers on indexing. For that reason, I like to refer to indexed investing as "evidence-based investing" because the evidence is clear that very few average fee active managers and individual investors have outperformed their respective indices. Looking at the Dalbar report or numerous academic studies, all point to the same conclusion.
Framing indexing as "evidence based" gets people's attention.
For a really good presentation on books for DIY Investors that present the aforementioned evidence, check out the guest blog at Get Rich Slowly. But don't just stop at the post--check out the comments where you will find a good give and take on active management versus indexing.
Posted by Robert Wasilewski at 7:29 PM
Labels: DIY investing
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I tried posting a comment on the Get Rich Slowly post Robert (twice) but I don't think it worked.ReplyDelete
So I figured I'd post it here:
Indexing has worked very well for me over the past 11 years. I've built a seven figure portfolio during this "lost decade" by being fearful when others are greedy and greedy when others are fearful----just by rebalancing between stock and bond indexes. I've bought individual stocks too, but it's a heck of a lot easier with indexes.
Re: That's interesting because my comment didn't register as well. He must have some type of filtering device. In any event I think it is a good site to keep track of.ReplyDelete
The debate will go on forever. Some people are truly talent, and can and will beat the market. I'm not one of those people. As Andrew says, it is much easier and safer for the average Joe to build a balanced portfolio with indexes than picking individual stocks.ReplyDelete