Professor Charles D. Ellis of the Rebalance Investment Committee on the how index investing wins. More on index investing for retirement.
Indexing is the right way to invest whether for retirement or other purposes for a very, very simple reason. It really works. And all of the alternatives, ironically only because so many people are trying so hard with such skill and such resources of information in all the alternatives, that they’ve got it figured out. And the incremental return that somebody might be able to capture, first of all, can’t be predicted. You never know who’s going to be able to do it.
And, secondly, the fees are larger than the incremental return. So, after fees, the best place to be is indexing and ETFs. And it’s so easy. And it’s so sensible. And it’s so economic that there’s no reason not to.