April 23, 2017, 07:05:11 PM


Author Topic: Investing your money, in Korea  (Read 34792 times)

Offline Davey

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Re: Investing your money, in Korea
« Reply #180 on: Yesterday at 02:34:45 AM »
E.g.,  sample 500,000 Canadian retail mutual fund investors consistently underperformed the market by an average 3% per year over the course of the last 15 years.

Right. And that is mathematically required...

The market participants are the market, so if the return of that market is 10%, the average return of a large group of investors is going to be somewhere under 10% because of trading costs, mutual fund fees, etc. The best a large sample like that could ever do would be 9%. We would need to see outlier stats.

Yes, so the point is that, active investing will generally not beat index investing over the long-run.  This obviously isn't the only study that shows this.

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Offline Ptolemy

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Re: Investing your money, in Korea
« Reply #181 on: Yesterday at 03:39:55 AM »
Yes, so the point is that, active investing will generally not beat index investing over the long-run. 

The market is the market, so the avg return will always be that of the market, but less due to fees. However there could be a huge number of outliers that beat the market, and who did so consistently...those stats don't actually tell us that part.

Offline Davey

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Re: Investing your money, in Korea
« Reply #182 on: Yesterday at 07:37:25 AM »
Yes, so the point is that, active investing will generally not beat index investing over the long-run. 

The market is the market, so the avg return will always be that of the market, but less due to fees. However there could be a huge number of outliers that beat the market, and who did so consistently...those stats don't actually tell us that part.

Right, right, but a huge number of outliers who consistently beat it? When you consistently, over what time horizon? Long-run like 10 years+? Not impossible, but extraordinarily difficult. If you've done it , kudos to you, and I mean that seriously.
« Last Edit: Yesterday at 10:09:38 AM by Davey »
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