Active beats passive in 7 year "bet" (again)

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Re: Active beats passive in 7 year "bet" (again)

Postby 1210sda » Mon Jul 01, 2013 8:50 pm

btenny wrote:Petro and others,

According to Rick Ferri at this post we just discussed a few days ago mixing passive funds is the KEY ingrediant besides low cost....


The paper says that investing in a MIX of index funds is by far the best for PORTFOLIO returns 75% or more of the time. Even better than single index funds. The key in all these comparisons of one active single fund versus one passive single fund misses the key ingerdiant, diversification. A single active fund might only win 50% or more of the time statistically in comparison. But two or more active funds only wins 25% of the time against a mix of 2 passive bond/stock indexes. And it gets even worse if you use 3 or more active funds if the type of funds over laps versus 3 or so index funds......



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Re: Active beats passive in 7 year "bet" (again)

Postby rfburns » Mon Jul 01, 2013 9:13 pm

However, with that said, I use varying mixes of actively managed funds in my portfolio. I track my performance against Target 2025.

I think it's great you can do that. I don't want to spend that much time hoping to juice my portfolio.
I have nothing against low cost managed funds that are winning, but not when they are losing.

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