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Old 15-09-2018, 12:06 AM   #652
Shiny Things
Supremacy Member
Join Date: Dec 2009
Posts: 7,840
Something I haven't understood:

why are most recommendations about investing in ETFs? Sure the risk profile or time frame of some people would indicate that they can invest in sectoral or other equity funds? I get the bit about funds domiciled in Ireland and Luxembourg.
The reason I'm not a fan of that is that it amounts to trying to pick which sector's going to be hot. And picking sectors, or even picking countries, is just like picking individual stocks; the average person probably isn't going to be any better at stockpicking than a professional, and the average person is probably going to buy things that are hot and sell them when they're cold. Better to own the broadest portfolio possible, consistent with their investment goals.

And as for "why index ETFs instead of managed equity funds": the long and the short of it is that on the whole, after fees, managed equity funds deliver worse performance than boring low-cost index ETFs. Why pay for your fund manager's Maserati? That money belongs in your pocket, not theirs.
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