Tim Armour investment strategies
In an article about investment strategy, Tim talks about investing in S&P 500 passive index funds compared to investing in mutual funds. Investing in simple, low-cost index funds that have been bought and held for a long term often has high returns. Mutual funds, on the other hand, provide low long-term returns in investment.
This is because of the high costs incurred in management fees and the excessive trading of the funds. Despite these, investing in active funds with low management costs generates more returns compared to investing in S&P 500 passive index funds. Also, index funds do not insulate the investment against down markets.
This, therefore, makes the investor vulnerable to 100% of volatility and losses. Moreover, the opportunity costs incurred and the volatility risks of a passive index- funds are also unknown. This is detrimental to a long-term investment.
No clear investment can guarantee high returns, it is, therefore, essential for you to carry out research on exceptional fund managers. Eliminating high-cost fund managers and by using fund managers who invest their resources alongside your investment is a very certain way of getting high returns on your active funds.
Investing your money in companies with years of experience in the investment markets is a safer way to provide high returns. Companies with expertise in the investment markets will guide you on which investment platforms to invest in. These companies also have more experience in dealing with the various risks and challenges that might arise.
Tim Armour work and education history
Tim Armour graduated from Middlebury College with a BA in Economics in 1982. He started working for Capital Research and Management Company as a Fund Advisor in 1983. His aggressiveness and brilliance propelled him to become the chairman of the company in 2015. He currently serves as the Chairman and CEO of Capital group companies.
Visit the official website of Capital Group on thecapitalgroup.com