 Quote:
Originally Posted by utrecht
All I used to hear was that actively managed funds would never beat an SP500 index fund like VFINX long term.
Thoughts?
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First of all - that is not what was being said. Some funds will beat the index, heck - the managers can't all be THAT bad! Monkeys with darts will beat the index routinely.
The problem is identifying them upfront. Jumping into one with a good track record may be just the time that it is starting to underperform. How can anyone know?
The second problem (and it appears you did NOT fall into this trap), is to compare some xyz fund with an index that with a different risk profile. No trick to get better returns if you take on more risk and volatility along with it.
It looks like those two funds have done well and the risk is in-line with the S&P. I owned each of them for a while back in the 80's.
Good luck, I hope they continue to do well for you. I'd buy some, but that would certainly result in them underperforming. I wouldn't want to do that to you  - ERD50
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