We work really hard to earn money, and then invest it with hopes of better returns. People who do not actively track stock markets prefer to invest in mutual funds. These are considered safer than equity.
The key to succeed in the stock market is to buy low and sell high. Easier said than done.
More than 70% of mutual funds do not out perform their benchmark indices. Fund managers are highly educated, intelligent and trained people. Yet most do not need beat the index. The above graph is an indication of how badly the fund managers timed the market in 2009. They had the highest cash holding in their portfolio when the market was at the lowest point.
This leads to me ponder if its worth my while to bother investing in mutual funds when I can easily invest in an Index ETF (exchange traded fund).
