Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Support MFO
Donate through PayPal
Sorry, Mr. Bogle, But I Respectfully Disagree. Strongly.
Viewpoint by James Moore of Pimco. Mr. Moore explains his argument against Mr. Bogle's statement that index investing is better than active management when it comes to bonds.
Thank you for the PIMCO generated reference. The author makes some very valid points why an investor might select an actively managed Bond fund.
I recently examined a Vanguard generated paper that purportedly demonstrated the almost universal underperformance of these funds relative to appropriate Indices.
Both agencies have incentives to reach their divergent opinions.
When I locate it, I'll post the Vanguard reference.
That task didn't take much effort. The Vanguard document is titled "The Case for Index Fund nvesting". Here is the Link:
It is not like comparing apples and oranges but the PIMCO article emphasizes bond investingand the Vanguard article is mostly about equities.so perhaps both are right.
Index investing is market (or category) returns, less expenses, if your happy with that fine, hop on Vanguard, If you want better, you have some work to do
Thanks @MJG for the Vanguard reference. This is one of those arguments that will never be settled. Both styles have their advantages. In the case of bond funds, the recent popularity of unconstrained bond funds underscores the need for good active management.
Comments
Thank you for the PIMCO generated reference. The author makes some very valid points why an investor might select an actively managed Bond fund.
I recently examined a Vanguard generated paper that purportedly demonstrated the almost universal underperformance of these funds relative to appropriate Indices.
Both agencies have incentives to reach their divergent opinions.
When I locate it, I'll post the Vanguard reference.
That task didn't take much effort. The Vanguard document is titled "The Case for Index Fund nvesting". Here is the Link:
https://pressroom.vanguard.com/content/nonindexed/Updated_The_Case_for_Index_Fund_Investing_4.9.2014.pdf
These divergent viewpoints should always be welcomed by MFOers. We get to choose our own poison.
Best Wishes.