87% of all funds return less than S&P??????

Quote from kapama:

I read this article in WSJ sometime ago and since I trust their information, I am schocked.

How can this be true? Are all these people unaware of the S&P index fund or any other index funds for that matter?

Forget the return, investors to these funds, why are they paying all those expense ratios and front load charges and back end charges? Just to receive returns less than S&P??? I can understand some funds returning less than the index but 87% of all funds???

C'ommmon what am I missing here?
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This is one of the most powerful and telling statements on market structure, analytics, and trading.

IOW, over 80% of the brightest guys out there just can't figure out how to beat the market ... and it's nothing personal. :D

Thank you for the post.

Good trading,

Jimmy Jam
 
Quote from JimmyJam:



IOW, over 80% of the brightest guys out there just can't figure out how to beat the market ...
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But we at ET will try anyhow!! :D
 
Juding by hopw so many people on ET or short in the trading section or recommend bad stocks on the 'stock' section I'm not too surprised such a high percentage of fund managers are unable to beat the market.

Beating the market is so easy.

There is no excuse not to.
 
Juding by how so many people on ET are short in the 'trading' section or recommend bad stocks on the 'stock' section I'm not too surprised such a high percentage of fund managers are unable to beat the market.

Beating the market is so easy.

There is no excuse not to.
 
Just a watcher,however:
I don't like their benchmark,especially how they are capitalization weighted.I never thought that selling 10,000 shares of MSFT should automatically apply to the total capitalization.The price is the result of the number of shares offerred and bought.
If they were honest in comparing they would evaluate the mutual funds the same way.If they they evaluated this way the scam,when explained would be exposed.( Not defending mutual funds since I believe they are run by people that are more comfortable trading other peoples money- takeing a fee rather than risking their own money.)
NOT ONE WORD THAT COMES FROM THE FINANCIAL PRESS IS HONEST.IT SHOULD ALL BE LABELED AS ADVESTISING.

All the above is my humble opinion.
 
Quote from Thunderdog:

I suppose that if someone wanted to get a low-cost S&P500 buy-and-hold return, for every $75,000 or so, he could buy one front month ES contract and invest the surplus funds in T-Bills. The only cost would be the ~$5 commission on the front month contract roll every 3 months. Am I missing anything important here?
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I am sorry I am not understanding. What does "front month ES contract " mean?
 
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