The only rational path for individual investors is to invest in passively managed index funds. For the reasons described here, active management is a negative-sum game. Index funds track the performance of a particular market benchmark (“index”) as closely as possible. They do this by buying all, or at least a representative sample, of the securities in the benchmark. Indexing now represents approximately 30% of all investment dollars. Index mutual funds have $2 trillion in assets. ETF index funds have a similar amount. Surprisingly, that means that approximately 70% of investment dollars are still in actively managed funds! Continue reading Investing for Retirement: Passive Investing – Indexed Mutual Funds & ETFs