An investment most of the time is supposed to generate profit and make your money worthwhile. Warren Buffett, an investor, invested in a passive index fund and was confident that he would do better than managers of the hedge fund. So confident was he that he placed a bet of $1 million for charity if the investment will fail and more information click here.
Mr. Buffet is in support of small cost investment and single investment that are bought and held for a long term. His approach is that of bottom-up investing and analyzing companies and establishing a strong portfolio. This method has proven itself over a couple of years. Mr. Buffet has been in forefront advising the American citizens to save more for their retirement.
In the annual shareholder letter, Mr. Buffet with his wisdom suggested to the consumers that they should be worried about product labels. He goes ahead and says that the active and the passive debate don’t serve investors as it is an intra-industry argument. Mr. Buffet adds that it’s not about the passive and the active, but rather about delivering good investment return that is long term and at a lower cost. These are the main component of those returns and learn more about Tim.
He also says that it has reached a time when we are supposed to challenge the idea that passive index is useful for a better retirement because the passive index doesn’t provide a cushion against down market. He says that index fund exposes investors to 100% volatility during market downfalls. It may also lead to losses during the downturn.
Mr. Buffet adds that doing better at the worst period is the most important thing an investor can do. To find and identify exceptional managers you use two simple filters which are small expenditure and a better manager ownership. Mr. Buffet adds that it is nothing obvious about doing better than the average market. Lastly, Mr. Buffet’s advice that we should talk about steps young investor can take to earn higher returns and a stable future and Tim’s lacrosse camp.
About Tim Armour, chairman and chief executive officer of Capital Group
Tim Armour holds a bachelor degree in economics from Middlebury College. He began his career as a participant in the Associates Program. He has 34 years of experience all with the Capital Group. He became the chairman of The Capital Croup in 2015.He is president and the CEO of Capital Group; chairman and principal executive officer of Capital Research and Management Company, Inc., part of Capital Group; and chairman of the Capital Group Management Committee. He is also an equity portfolio manager.