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April
1st, 2011 |
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April 1st Proclaimed “INDEX FUNDS DAY” to Draw Attention to the Foolish Behavior of the Active Management of Investments.
The "you can beat the market" hoax.
April 1, Index Funds Day, is the ideal time to draw attention to the differences between active investment management and indexing – and why it's a fool's game to think one can outperform the market averages.
A consortium of top fee-only financial advisors, with almost $2 billion
under management, has formed an alliance to declare April 1 Index Funds
Day, and to expose what they believe is the hoax played on investors every
day of the year - the active money management hoax.
This is no harmless prank – the extra fees associated with active management
cost investors billions of dollars in foregone investment returns by fooling
investors into thinking their money managers can systematically beat the market
by picking winning stocks. News events move stock prices, but since news is
unpredictable, so are stock prices. Picking winning stocks is largely a matter
of luck, making sustainable success a difficult proposition. [more]
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