

The death of index investing (2008) - gasull
http://earlyretirementextreme.com/the-death-of-index-investing.html

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rm999
I'm confused, why is this posted four years after it was written? Is it to say
OP was proven correct or incorrect? I'm assuming incorrect given the great
performance of index funds in the last three years, but it's hard to tell
because the market remained in sell-off mode into 2009.

Anyway, I mostly disagree with OP. While I am not a firm believer in the
efficient market hypothesis, I think it is very close. Index funds reflect the
'crowd-sourced' research from many very smart investors who have a lot on the
line. I am 100% sure their combined research is more accurate than what I am
willing to do in a few hours a month of my free time. Index funds are
basically what give me the confidence I can safely invest my money into a
large part of the American/World economy at a fair rate.

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_lex
An index fund just mimics the market and has no research behind it. It's meant
to perform just as the market does.

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rm999
This is why I said 'reflects'. An index reflects the market, so any research
that goes into the market goes into pricing the index fund.

