The ins and outs of index investing - Pt 1

Key Points Index investing is cheap and worth a look, especially as active funds don’t generally outperform when the additional fees are accounted for The core-satellite approach offers an opportunity to get a low-cost entry into the best of both worlds The world of ETFs and index investing examined in detail in part 2    The Myths We all want good performance from our investments. But most of us believe that, at least in the area of managed funds, we have to pay for it. That’s why many managed fund investors pay up to 2% a year for an active...

We all want good performance from our investments. But most of us believe that, at least in the area of managed funds, we have to pay for it. That’s why many managed fund investors pay up to 2% a year for an active fund manager, compared with less than 0.5% in many cases for an index-tracking fund.

Often the deck is stacked against the active fund investor. You’ll pay the fees but the chances are, you won’t get the performance.

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