The case for LICs

Key Points LICs offer an opportunity to improve your long term index investing returns SMSFs, in particular, can achieve substantial benefits Our financial model enables you to assess the potential benefits Background John C. Bogle is the famous proponent of index investing, covered in The ins and outs of index investing—Part I and II. Bogle says, if you want to own growth assets like shares, it’s better to buy a low cost index fund or ETF than to invest in a managed fund. Managed funds, on average, don’t outperform the index once fees are accounted for. An index fund...

John C. Bogle is the famous proponent of index investing, covered in The ins and outs of index investing—Part I and II. Bogle says, if you want to own growth assets like shares, it’s better to buy a low cost index fund or ETF than to invest in a managed fund.

Managed funds, on average, don’t outperform the index once fees are accounted for. An index fund or ETF will match the index for a much lower cost, creating higher average returns.

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