Re: Why Mutual Funds are better than Index Funds
Hi Wildwood,
I agree with everything you say including that a serious investor should look at and even purchase specialty index funds as part of their portfolio.
The purpose of my post is to show how many have prejudiced themselves against mutual funds, despite the fact that there are a number of them that consistently outperform their respective indexes in both interest returns and fluctuation.
I do not believe (as others assert) that consistently beating the index is just a fluke occurence and gives no indication of future performance.
I also understand that a successful fund will eventually outgrow the market, but one should still follow those managers as they create new funds, and listen to their advice.
Why people would invest in an S&P 500 index when you have Berkshire Hathaway B stocks, or some good mutual fund options is beyond me. Those who have indiscriminately invested in indexes thinking you can't do better are as big suckers as those who have purchased sub-par mutual funds.
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