jkane

The Fall of Index Funds

Seekingalpha should be embarassed, publishing such a ridiculous article, and the author should be ashamed of himself.

How is it possible for active management to "typically" lose less in bear markets after fees, when they make up the market? And the evidence is clear that active management "in general" does not lose less in bear markets. (this would be mathematically impossible, according to William Sharpe).

And why would you expect balanced funds to beat stock index funds going forward when the source of bond returns over the past 10 years was due to the higher yield environment in the past, something that is not true today? Your same prognostication that the future for stocks will be different than the past will be the same for bonds and balanced funds, since the bond environment is very different today as well.

And do you know anything about indexing? As others have pointed out, you are comparing apples and oranges, the biggest rookie mistake investors make.

Truly an embarrassment. Seekingalpha usually has some pretty bad articles, but this one takes the cake.