• / Free eNewsletters & Magazine
  • / My Account
Home>It Is Possible to Outperform the Broad Market Indices Over the Long Term

Related Content

  1. Videos
  2. Articles
  1. Bogle on Fund Industry Progress and Imperfections

    The Vanguard founder offers his thoughts on the need for money fund reform, the dilemmas with retirement planning and savings, the fiduciary duty of fund managers, and much more, in this video exclusive to Premium Members.

  2. Jacobson's Picks for Core Bond Exposure

    Morningstar's director of fixed-income research offers his tips for selecting a solid core bond fund along with some of his favorite choices.

  3. Investors Flock to Foreign-Stock and Noncore Bond Funds

    As rising rates and emerging markets lose momentum, fund investors are eyeing nontraditional fixed-income categories and European and Japanese equities.

  4. Rising-Rate Concerns Push Investors to Noncore Assets

    May flows data show investors are putting money to work in nontraditional fixed-income holdings, as well as emerging-markets equities, for perceived better returns.

It Is Possible to Outperform the Broad Market Indices Over the Long Term

07/30/2014

The following are the major points made in this article:

-A more and more recurrent theme in fund investing has been that broad index funds will be the best choice for investors.

-Most managed funds tend to perform no better than the entire stock market but with higher fees.

-Fund returns for the entire stock market as well as for non-core categories likely will vary significantly from each other over periods lasting 5, 10, or more years.

-Knowledge of these discrepant returns, as well as careful specific fund selection, can point to investments that will outperform the core market averages by significant enough amounts over given periods to make non-core and non-index fund choices highly worthwhile.

-Data is presented that shows that even nearly 15 years ago, a list of more than a dozen stock funds and a handful of bond funds, could be identified that would increase an investor’s annualized return on each 10K investment by about $5K.

Many investors may immediately recoil at the headings for this article. And why not? Actively seeking out the best funds to invest in, meaning not just picking the most popular index or managed funds, and then actively managing your portfolio takes time, some degree of knowledge, and may fly in the face of what many experts will tell you. The best approach to achieve the best performance, these experts say, is to latch on to perhaps a small number of good funds/ETFs, often non-managed index funds, and then don’t monkey with them.

blog comments powered by Disqus
Upcoming Events
Conferences
Webinars

©2014 Morningstar Advisor. All right reserved.