Buffett stated that by simply investing in an S&P 500 passive index fund, he would be able to achieve a better investment return than any hedge fund manager and made a wager of one million dollars to back up his claim.
One million is a lot of money and can change a lot of lives within a charity. Mr. Buffett stated and promised that he would donate this large lump sum of funds, but only if he was incorrect In his assumption of the success rate involving passive index fund investing and Tim’s lacrosse camp.
Mr. Tim Armour supports the commitment that Mr. Buffett has for low cost, simple investments. He feels that they should be held and bought for long term investing. Tim also agrees with Buffett’s approach of bottom-up investing, over many decades it has been proven that rigorously analyzing companies and building a durable portfolio is the best method.
Passive index Investments are usually underestimated and unknown to the investor. They hold a volatile risk compared to many other mutual funds which provide a poor long term and high management fees and learn more about Tim.
Tim Armour, one of the best investors and fund managers, states that Buffett’s views can be short-sighted at times. He feels that it’s not about how closely the funds are indexed but more about how high the expenses are for the investors and if they’re being managed correctly.
Investments is not the only downfall of a fund. Tim feels that if more hedge fund managers bought in on the fund it would actively offset the funds high expense rate. It is also beneficial for the investor to actively move their investments towards funds that have low expenses and read full article.
When taking this approach it guarantees that the hedge fund managers will have an active interest in the investment funds and the money is not wasted and his facebook.
Tim Believes that investments that are bought at a low cost should be held onto for long term. Tim went to college in Middlebury and gained a Bachelor’s degree in economics. He currently resides in Los Angeles where he is the chairman of capital group.