A Market index provides a tough hurdle to beat for any investment strategy. Employing an index is almost always better than a strategy that systematically picks a subset of its space or time (i.e., does portfolio-picking, or market timing ). The cost of a predetermined index is low, since no thought is required, and the long-term results over the last century of major market indices have been impressive. So, the argument goes: “Why waste your money paying for expensive managers who may only beat the market by luck?”
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