Comments on: When to Use Index Funds and When to Use Individual Stocks http://www.thedividendguyblog.com/when-to-use-index-funds-and-when-to-use-individual-stocks/ One Guy's Journey to Passive Income Through Dividend Investing Fri, 10 Feb 2012 13:02:29 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Wade http://www.thedividendguyblog.com/when-to-use-index-funds-and-when-to-use-individual-stocks/comment-page-1/#comment-54111 Wade Wed, 28 Jan 2009 03:17:03 +0000 http://thedividendguyblog.com/?p=93#comment-54111 To try and provide an answer to the first comment, Investing Intelligently.... One reason mutual funds stink is that they have to follow what their prospectus saids they will do, regardless of market conditions. So if it's a tech fund, they HAVE to be long, and they have HAVE to be in tech. The individual investor, on the other hand, can choose to go to cash, can go short, can decide to double or triple weight a particular commodity, etc. So I think we're actually at an advantage. To try and provide an answer to the first comment, Investing Intelligently….

One reason mutual funds stink is that they have to follow what their prospectus saids they will do, regardless of market conditions. So if it’s a tech fund, they HAVE to be long, and they have HAVE to be in tech.

The individual investor, on the other hand, can choose to go to cash, can go short, can decide to double or triple weight a particular commodity, etc. So I think we’re actually at an advantage.

]]> By: Jose http://www.thedividendguyblog.com/when-to-use-index-funds-and-when-to-use-individual-stocks/comment-page-1/#comment-580 Jose Thu, 23 Mar 2006 03:17:37 +0000 http://thedividendguyblog.com/?p=93#comment-580 Simple decission tree, but I like it. Simple decission tree, but I like it.

]]> By: GIV http://www.thedividendguyblog.com/when-to-use-index-funds-and-when-to-use-individual-stocks/comment-page-1/#comment-570 GIV Tue, 21 Mar 2006 16:21:12 +0000 http://thedividendguyblog.com/?p=93#comment-570 Safari internet browser likes the new site format MUCH more. Safari internet browser likes the new site format MUCH more.

]]> By: Investing Intelligently http://www.thedividendguyblog.com/when-to-use-index-funds-and-when-to-use-individual-stocks/comment-page-1/#comment-566 Investing Intelligently Tue, 21 Mar 2006 09:14:46 +0000 http://thedividendguyblog.com/?p=93#comment-566 I don't see any advantage to picking stocks by oneself for the individual investor. If mutual funds cannot do better the indexes on a consistent basis I don't see how an individual investor can, especially without spending 40 hours a week. I think factors like how much money you have is also very important for cost reasons. Also, indexing makes a lot of sense for large-caps but not as much sense for small-caps where the market is not as efficient, and therefore active management has a better chance of performing better. For better or for worse, I don't think anyone can ignore mutual funds completely as an option for parts of their retirement portfolio. I don’t see any advantage to picking stocks by oneself for the individual investor. If mutual funds cannot do better the indexes on a consistent basis I don’t see how an individual investor can, especially without spending 40 hours a week. I think factors like how much money you have is also very important for cost reasons. Also, indexing makes a lot of sense for large-caps but not as much sense for small-caps where the market is not as efficient, and therefore active management has a better chance of performing better. For better or for worse, I don’t think anyone can ignore mutual funds completely as an option for parts of their retirement portfolio.

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