Which is exactly why the average guy should just buy an index tracking fund instead of paying some b.s. mutual fund company to take 2% a year and underperform.
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Hedge Funds May Cut a Record 20,000 Jobs as Losses Erode Fees
- Thread starter ASusilovic
- Start date
Which is exactly why the average guy should just buy an index tracking fund instead of paying some b.s. mutual fund company to take 2% a year and underperform.
Quote from Vinny1:
Let me guess...you must work for a hedge fund or a mutual fund or sell mutual funds right?
How much time does it take to click the buy button or call up your broker and say buy me 1000 shares of ABC company or a bond. A whopping 10 seconds perhaps? Not exactly brain surgery.
how much time does it take? just about as much time it took me to realize who has been on the other side of my trades for the past five years. thank you vinny1. you made my ferrari possible.
70% of them lost money in 2008?! I'm no financial planner, but I think you'd get more satisfaction out off burning your money, than investing it into one of those.
Quote from ScapGF:
However, you can't diminish the level of difficulty and expertise that it takes to consistently outperform the indexes.
When a bunch of funds are trying to predict the market, some will always be above the indexes. That is called probability. There is little to no proof they exhibit "expertise." The financial crisis pretty much blew away the theory that the Quants and Predictors outperform. They just outperform until Risk of Ruin comes home to roost.
This is not a game of throwing darts with a blindfold on.
Could have fooled me. Blindly following indexes has usualy outperformed more than half the Predictor firms - in fact, most years, it was like the index outperformed 70% of the funds. The darts seem to be the better choice...
Quote from ventus:
how much time does it take? just about as much time it took me to realize who has been on the other side of my trades for the past five years. thank you vinny1. you made my ferrari possible.
Are you serious?
So the average investor should instead spend time and effort and possibly financial advisor fees to try to pick the top hedge funds to invest in (of which the overwhelming majority don't outperform even the s&p500.)
And to top it off, once you are underwater, the fund closes up shop and realizes your losses, just for you to start all over again.
AND, you have the possibility of ending up with a Madoff, and realize an effective -100% of your investment.
Should we continue debating the merits of hedge funds vs indexes?
Quote from mogul:
Should we continue debating the merits of hedge funds vs indexes? [/B]
You clearly don't understand the utility of hedge funds..If someone has 50 million, they aren't going to open a brokerage account and buy etfs...if they were that dumb they probly wouldn't have 50 mil. The "average" investor and hedge funds have nothing to do with each other.