Asked on 14 Apr 2020
Studies showed that only 18% of active investors perform better than index. Any reasons on why we should invest in active funds given the high fees also?
If u have time, you can do active investing. If you don't have, which I think most of us don't have, I think passive investing Is the 1 to go for.
people who help u monitor, who manage for u buy and sell...the fund managers exchange their time and knowledge for money. Whereas we use money to exchange for these active managers to manage our portfolio.
Why active management by yourself (or a fund manager) is a very disadvantageous idea you could read here:
nowadays you can manage equity investing all by yourself with some reading (f.ex. the mentioned evidence based book). there are so many beautiful and diversified cheap&large ETFs. It is difficult to see for the beginner that the simplest solution to investing leads to best performance...
27 Apr 2020
Active vs. Passive is based on 2 factors: how much time and capital you have on hand. For active investing you need to be constantly monitoring the markets (especially during current market conditions) whereas with passive you focus on lower risk investments such as ETF’s
Kristal.AI is a platform you can consider because they offer a wide range of ETF’s across global markets and they have an algorithm which provides personalized investment advice based on your risk profile and investment goals.
Here's the link to Kristal's review for your reference:
Hope this helps,
It depends on your needs and fund selection. While the statistics may be true, it doesn't give you a complete picture on your investment portfolio. For instance, the risk that we are undertaking in order to achieve the desired return, as well as whether active management is done to the current portfolio.
In any case, there is no right or wrong answer to this end. Instead, it depends on your investment objective and what you are comfortable to invest your money into.
I share quality content on estate planning and financial planning here.
I would encourage you to pick up active investment yourself, read some books, paper-trade, and invest in your own education. Right now, perhaps you may have very little investment capital, and EVEN if you can achieve 20% returns, you may think it may not be worth your time invested in getting those returns, but 10 years down the road, it will start making it worth your time (because your portfolio will be bigger), but you would have lost 10 years of learning.
Most active funds dont beat the market, so i definitely won't hand over my money to an active fund manager. But i do encourage most people to learn about value investing, individuals like us can access investment opportunities that the big boys can't.
Can take a look at this article: https://www.straitstimes.com/business/banking/worlds-biggest-hedge-fund-returns-found-in-singapore
"Even though his fund's annualized volatility is a whopping 72 per cent - it returned 260 per cent in 2017 only to plunge 49 per cent the following year"
If you got the money, can consider a bit. If don't have millions of spare cash lying around then passive investing the way. Little effort and good returns.
27 Apr 2020
Show More Products