Whats the purpose of the whole asset management industry.
95% of the fund managers underperform simple index funds. They just costing the client money on research and trading cost.
If the fund managers are good at making money, why are they doing it for someone else and not themselves ?
If they can trade and make money, why are they asking money from investors ?
Explain this to me please
byu/BobbyPeruhere4u inpersonalfinance
Posted by BobbyPeruhere4u
2 Comments
There’s more to investing than “stick it in the mutual fund for 30 years.”
You might want to invest in specific industries. So you need a fund that has those kinds of investments you want. Rather than do research and track dozens of stocks and bonds, you pay someone a small fee to do all that for you.
You might want your investment split to different things. Say you want some invested short term and some long term. Or you want a certain amount of money withdrawn from your investments yearly. That opens up a lot of different options for investing.
Plus good investment managers and client know that on a long term a broad diversified portfolio beats any individual picks. So that is almost always part of the strategy anyway.
The asset management industry exists mainly to provide access, structure, and service not guaranteed outperformance.