Index Funds Crush Actively Managed Funds: Time to Upgrade Your Investment Strategy?
2025-03-09
For years, actively managed fund managers have claimed to beat the market, but data reveals a harsh truth: index funds significantly outperform them in the long run. The SPIVA report shows that the majority of actively managed large-cap US equity funds have underperformed the S&P 500 index for years. Ordinary investors should opt for the simplicity, low cost, and superior long-term performance of index funds, avoiding emotional investment mistakes. While concerns exist about the concentration of power in index funds, such as potential impacts on corporate governance and political agendas, their superior long-term returns make them the preferred choice for the average investor.