What Experts and Research Say: The Active vs. Passive Debate

(Open for all my sources)
Should you invest in index funds or actively managed funds? I took the last weeks to research scientific studies and expert opinions and put together this video with what I found regarding the performance of active and passive funds.

T I M E S T A M P S :

0:00 Intro
0:47 Recap: What are Active and Passive Funds?
1:56The $ 1 Mio. Bet
3:03 What Scientific Studies Say
4:29 Active Fund Performance in Recession Periods
5:46 What are the Odds of an Active Fund Outperforming?
7:58 What Experts Have to Say
10:12 My Personal Take on This Debate
11:06 Outro

S O U R C E S & L I N K S :

Studies:

Other Studies mentioned in timeline:
● Chen, S. and Jang, H. (1994), “On selectivity and market timing ability of US-based international mutual funds: using refined Jensen’s measure”, Global Finance Journal, Vol. 5 No. 1, pp. 1-15.
● Gallo, J.G., Lockwood, L.J. and Swanson, P.E. (1997), “The performance of international bond funds”, International Review of Economics and Finance, Vol. 6 No. 1, pp. 17-35.
● Lin, W. (2006), “Performance of institutional Japanese equity fund managers”, Journal of Portfolio Management, Vol. 32 No. 4, pp. 117-127.
● Polwitoon, S. and Tawatnuntachai, O. (2008), “Emerging market bond funds: a comprehensive analysis”, Financial Review, Vol. 43 No. 1, pp. 51-84.
● Michelson, S., Philipova, E. and Srotova, P. (2008), “The case for emerging market funds”, Journal of Business and Economics Research, Vol. 6 No. 11, pp. 81-88.
● Basu, A.K. and Huang-Jones, J. (2015), “The performance of diversified emerging market equity funds”, Journal of International Financial Markets, Institutions & Money, Vol. 35 No. C, pp. 116-131.

Results of the 10 year bet between Warren Buffett and Protégé Partners:

Snippets of articles shown:

What Experts Say:
● Ray Dalio: Facts taken from the book MONEY: Master The Game (Tony Robbins, 2014) Chapter 1.1, page 21

Pictures Used:
● Warren Buffett: AP Images and Carlo Allegri (Reuters)

D I S C L A I M E R :

The information provided in my videos is not intended as investment, financial, tax, or legal advice. All information provided is for educational purposes only. I am not a Certified Financial Planner. Investing in the stock market involves risks and may result in loss of principal and capital gains. Past market performance does not guarantee future results.

#investingforbeginners #indexfunds #passiveinvesting