Index Funds Quotes

• Index funds eliminate the risks of individual stocks, market sectors, and manager selection. Only stock market risk remains.

  John C. Bogle

  Risk, Investing, Individual

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• By periodically investing in an index fund, the know-nothing investors can actually outperform most investment professionals.

  Warren Buffett

  Investing, Investment, Fund

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• A low-cost index fund is the most sensible equity investment for the great majority of investors. My mentor, Ben Graham, took this position many years ago, and everything I have seen since convinces me of its truth.

  Warren Buffett

  Years, Mentor, Majority

  "The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns". Book by John C. Bogle, March 05, 2007.

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• The best way in my view is to just buy a low-cost index fund and keep buying it regularly over time, because you'll be buying into a wonderful industry, which in effect is all of American industry... People ought to sit back and relax and keep accumulating over time.

  Warren Buffett

  Views, People, Relax

  "CNBC Exclusive: Liz Claman Interviews Warren Buffett, Berkshire Hathaway Chairman & CEO, Live at the Company's Annual Shareholder's Meeting in Omaha, Nebraska on "Squawk on the Street"". "Squawk On The Street" with Liz Claman, www.cnbc.com. May 7, 2007.

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• If you invested in a very low cost index fund - where you don't put the money in at one time, but average in over 10 years -you'll do better than 90% of people who start investing at the same time.

  Warren Buffett

  Average, Years, People

  Berkshire Hathaway Annual Meeting, 2004.

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• Our standard prescription for the know-nothing investor with a long-term time horizon is a no-load index fund. I think that works better than relying on your stock broker. The people who are telling you to do something else are all being paid by commissions or fees. The result is that while index fund investing is becoming more and more popular, by and large it's not the individual investors that are doing it. It's the institutions.

  Charlie Munger

  Thinking, Long, People

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• Most of the mutual fund investments I have are index funds, approximately 75%.

  Charles R. Schwab

  Investing, Mutual Fund, Investment

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• Most investors would be better off in an index fund.

  Peter Lynch

  Would Be, Investing, Active Management

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• I am a huge, huge, huge fan of index funds. They are the investor’s best friend and Wall Street’s worst nightmare.

  Jonathan Clements

  Wall, Worst Nightmares, Fans

  Jonathan Clements (2003). “You've Lost It, Now What?: How to Beat the Bear Market and Still Retire on Time”, Portfolio (Hardcover)

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• After a lifetime of picking stocks, I have to admit that Bogle's arguments in favor of the index fund have me thinking of joining him rather than trying to beat him. Bogle's wisdom and common sense are indispensable... for anyone trying to figure out how to invest in this crazy stock market.

  Jim Cramer

  Crazy, Thinking, Common Sense

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• Still, I figure we shouldn't' discourage fans of actively managed funds. With all their buying and selling, active investors ensure the market is reasonably efficient. That makes it possible for the rest of us to do the sensible thing, which is to index. Want to join me in this parasitic behavior? To build a well-diversified portfolio, you might stash 70 percent of your stock portfolio into a Wilshire 5000-index fund and the remaining 30 percent in an international-index fund.

  Paul Samuelson

  Fans, Investing, Want

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• The S&P is up 343.8 percent for 10 years. That is a four-bagger. The general equity funds are up 283 percent. So it's getting worse, the deterioration by professionals is getting worse. The public would be better off in an index fund.

  Peter Lynch

  Years, Would Be, Deterioration

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• Invest in low-turnover, passively managed index funds... and stay away from profit-driven investment management organizations... The mutual fund industry is a colossal failure... resulting from its systematic exploitation of individual investors... as funds extract enormous sums from investors in exchange for providing a shocking disservice... Excessive management fees take their toll, and manager profits dominate fiduciary responsibility.

  David F. Swensen

  Responsibility, Organization, Systematic

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• Experience conclusively shows that index-fund buyers are likely to obtain results exceeding those of the typical fund manager, whose large advisory fees and substantial portfolio turnover tend to reduce investment yields. Many people will find the guarantee of playing the stock-market game at par every round a very attractive one. The index fund is a sensible, serviceable method for obtaining the market's rate of return with absolutely no effort and minimal expense.

  Burton Malkiel

  Yield, Games, People

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• Index funds are the only rational alternative for almost all mutual fund investors.

  Mark Hulbert

  Alternatives, Investing, Mutual Fund

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• Index funds do not trade from security to security and, thus, they tend to avoid capital gains taxes.

  Burton Malkiel

  Investing, Gains, Taxes

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• Index funds are... tax friendly, allowing investors to defer the realization of capital gains or avoid them completely if the shares are later bequeathed. To the extent that the long-run uptrend in stock prices continues, switching from security to security involves realizing capital gains that are subject to tax. Taxes are a crucially important financial consideration because the earlier realization of capital gains will substantially reduce net returns.

  Burton Malkiel

  Running, Long, Friendly

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• Even fans of actively managed funds often concede that most other investors would be better off in index funds. But buoyed by abundant self-confidence, these folks aren't about to give up on actively managed funds themselves. A tad delusional? I think so. Picking the best-performing funds is 'like trying to predict the dice before you roll them down the craps table,' says an investment adviser in Boca Raton, FL. 'I can't do it. The public can't do it.'

  Paul Samuelson

  Giving Up, Self Confidence, Thinking

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• We can extrapolate from the study that for the long term individual investor who maintains a consistent asset allocation and leans toward index funds, asset allocation determines about 100% of performance.

  Roger G. Ibbotson

  Long, Investing, Study

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• When you look at the results on an after-fee, after-tax basis over reasonably long periods of time, there's almost no chance that you end up beating the index fund.

  David F. Swensen

  Long, Looks, Investing

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• While it is probably a poor idea to own actively managed funds in general, it is truly a terrible idea to own them in taxable accounts... taxes are a drag on performance of up to 4 percentage points each year... many index funds allow your capital gains to grow largely undisturbed until you sell... For the taxable investor, indexing means never having to say you're sorry.

  William J. Bernstein

  Sorry, Mean, Years

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• A minuscule 4 percent of funds produce market-beating after-tax results with a scant 0.6 percent (annual) margin of gain. The 96 percent of funds that fail to meet or beat the Vanguard 500 Index Fund lose by a wealth-destroying margin of 4.8 percent per annum.

  David F. Swensen

  Investing, Gains, Wealth

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• The commission of the investment sins listed above is not limited to 'the little guy.' Huge institutional investors, viewed as a group, have long underperformed the unsophisticated index-fund investor who simply sits tight for decades. A major reason has been fees: Many institutions pay substantial sums to consultants who, in turn, recommend high-fee managers. And that is a fool's game.

  Warren Buffett

  Games, Long, Guy

  "Here are the 6 things Warren Buffett considers when making an investment" by Jeremy Schwartz, www.businessinsider.com. March 14, 2015.

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• It's bad enough that you have to take market risk. Only a fool takes on the additional risk of doing yet more damage by failing to diversify properly with his or her nest egg. Avoid the problem-buy a well-run index fund and own the whole market.

  William J. Bernstein

  Running, Eggs, Risk

  William J. Bernstein (2002). “The Four Pillars of Investing”, McGraw Hill Professional

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• ... skepticism about past returns is crucial. The truth is, much as you may wish you could know which funds will be hot, you can't - and neither can the legions of advisers and publications that claim they can. That's why building a portfolio around index funds isn't really settling for average. It's just refusing to believe in magic.

  Bethany McLean

  Believe, Past, Average

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