Agreeing to Disagree

According to Warren Buffett, achieving a higher yield on your investment can be had simply by utilizing an S&P passive index fund. Mr. Buffett backed up these claims when he made a wager with a group of hedge fund managers for the amount of $1 million, that will be donated to charity. As the date for the wager nears its expiry, Mr. Buffett looks as though his claim will be proven correct and he will collect his earnings. Warren Buffett’s stance on investing in an S&P 500 passive index fund is backed by his perspective that many of the active funds today are overpriced, providing limited value in return. Due to this fact, seeking out low-cost investments to be utilized over the long-term, could be the way to secure financial freedom in retirement. Timothy Armour, Chairman and Chief Executive Officer at Capital Group, agrees with much Warren Buffett’s strategy, but their opinions diverge in a very major way. Although passive index funds have been traditionally thought of as safe paths to retirement, today, Timothy Armour feels that it is time to challenge that school of thought. During market downturns, investors are exposed to 100 percent volatility, a fact that nearly half of the 1200 investors surveyed online last year, were unaware of. While it is true that many of the actively managed funds have not done as well as their counterparts, statistic show that a person investing $10,000 in the first S&P 500 passive index fund would have half-a-million dollars today, but a person investing that same amount in the best five active funds today would have done better financially and learn more about Timothy.

Chairman and Chief Executive Officer of Capital Group, Timothy Armour, has over 34 years of experience in the world of investments. In 1983 Armour graduated from Middlebury College, where he soon began his association with Capital Group by joining The Associates Program. Today, he also serves as an Equity Portfolio Manager and Chairman and Principal Executive Officer of Capital Research and Management Company, Inc and more information click here.

Other Reference: https://medium.com/@timarmour

 

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