Edward Buffett has gambled $1 million in the hope that he can get better investment returns than hedge fund managers by investing in an index fund. In his latest yearly shareholder letter, Mr. Edward shares some of his wisdom thoughts based on his extensive years of investing. First, customers should be cautious of different type of product labels.
An “active vs. passive” debate is an argument that doesn’t serve investors. Numerous mutual funds offer poor or average long-run returns, in part because of excessive trading and high management fees. But in actuality, it isn’t about active investment or passive but delivering excessive trading investment returns on a long-term.
It is time to try the concept that index returns (passive) are the safer path for a better retirement. No doubt those funds have their place; however, they offer no cushion against unexpected downfall in markets. Opposing to what index supporters say, there’s nothing random regarding doing better than the average market over the long term.
Tim D. Armour is chairman of a globally acclaimed financial company known as Capital Group Companies. He is working as principal, executive officer and chairman of Capital R&M, a subsidiary of Capital Group, LLC, along with an additional role of equity portfolio manager. Armour has more than three decades of investment experience and that all with Capital.
In the beginning of his career with Capital, he worked as an equity investment analyst and in that position he covered different global U.S. service and communications companies. Tim based in LA and earned his bachelorette from Middlebury College in economics.