
Jason Voorhees
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- May 15, 2020
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I've this argument countless times from retarded niggers before. Why should I invest in S & P 500 when I can cherry pick the most profitable companies and earn larger profits? No S&P 500 are already weighted by market capitalization so you automatically invest more in those profitable companies.
But but but.. I can still pick those comapnies still and avoid the laggards dragging down my potential returns? Another amateur mistake. The thing about index funds is the rebalancing process the fund automatically adjusts the holdings depending on market performance.Say Nvidia did something big and Tesla tanked you need to readjust your portfolio ofc you as independent investor can try to adjust your portfolio but you also create taxable events with every trade you make reducing your returns when you have S&P 500 ETF the index committee handles all rebalancing internally with extensive data without triggering capital gains taxes for you something that you can't do individually. S&P 500 always has lower turnover rates
Even professional investors rarely outperform s&p 500 over long periods of time. The index funds give you the passive growth without of stock picking or market timing.
But but but.. I can still pick those comapnies still and avoid the laggards dragging down my potential returns? Another amateur mistake. The thing about index funds is the rebalancing process the fund automatically adjusts the holdings depending on market performance.Say Nvidia did something big and Tesla tanked you need to readjust your portfolio ofc you as independent investor can try to adjust your portfolio but you also create taxable events with every trade you make reducing your returns when you have S&P 500 ETF the index committee handles all rebalancing internally with extensive data without triggering capital gains taxes for you something that you can't do individually. S&P 500 always has lower turnover rates
Even professional investors rarely outperform s&p 500 over long periods of time. The index funds give you the passive growth without of stock picking or market timing.
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