www.marketwatch.com
A study from 2000–2020 reveals that a simple passive S&P 500 index fund outperformed 97% of professional college endowment managers. This highlights the “illusion of alpha,” where complex alternatives (private equity, hedge funds) and higher fees fail to generate excess returns compared to the broad market. Data suggests that despite their resources, active managers struggle to beat a low-cost, buy-and-hold index strategy over the long term. The primary reason is likely the drag of high management fees and the difficulty of consistently timing the market, proving that simplicity often wins over complexity in investing.
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