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Also, while buying & holding an ETF based on the S%P 500 is the canonical low-effort investing advise, it is trivially easy to beat this strategy by choosing an
by skgoa 8y ago
Also, while buying & holding an ETF based on the S%P 500 is the canonical low-effort investing advise, it is trivially easy to beat this strategy by choosing an index that performs better historically. E.g. the Russel 2000 or some other index that captures the price movements of medium sized companies. The S&P 500 tracks the biggest companies, which necessarily are the ones that have done most of their growing already.
- tanderson92 8y ago> it is trivially easy to beat this strategy by choosing an index that performs better historically. Past performance is no guarantee... This is a very subtle question which is far from resolved[1] in the academic literature; it is nowhere close to the slam-dunk you state it is. [1]: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3122326 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3122326