Finance research has consistently shown that investing in portfolios that track the market at a very low fee outperform most professionally managed funds. Warren Buffett himself has explained that he has made arrangements, once he passes, for his wife's wealth to be invested in a single index fund that tracks the S&P 500 Index at a very low fee.
To confirm this message, he recently won a 10 year bet against a New York City fund of funds hedge fund group, Protégé Partners, that a simple index fund would outperform Protégé Partners' specially-picked collection of hedge funds between 2007 and 2017.
Over this ten-year period, a S&P 500 index fund returned 7.1% compounded annually, significantly more than the basket of hedge funds selected by the professionals at Protégé Partners – which returned an average of 2.2%.
At Emperor, we believe that blending a passive and active investment strategies give our clients the best opportunity to outperform the benchmarks, that are tracked by index funds and ETFs.
Click here to view our historical performance and how we compare to the S&P 500.