Sunday, 25 March 2012

Why passive funds are not low risk

I have a love - hate relationship with index funds.  On the one hand with Scottish heritage I do not like paying fees and will generally object to the excessive and sometimes offensive fees charged by actively managed funds - passive funds provide a low cost alternative to actively managed funds. 

On the other side of the coin, the capitalist in me likes growing my terminal wealth.  Why would I want to maintain a long only (passive) exposure in a specific market at a time when the world is going to hell in a hand bag?  Some active managers are able to go to cash thereby protecting me as best they can against losing money. 

So how risky are passive (index) funds?  To find out open the attached link why passive funds are not low risk

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