Tim Armour said that Warren Buffet invested $ 1 million in charity. He did this to acquire better investment returns compared to a team of hedge fund managers. Tim says that Warren is correct that many expensive and mediocre funds frequently shortchange investors.
Tim adds that he supports Warren’s commitment to simple investments that are low costs and those that should be purchased and held for an extended period of time. The bottom-up investing approach of Warren Buffet has been able to prove itself for many years. Tim says that consumers need to be cautious of product labels in many industries. He adds that the debate about the active versus passive is an intra-industry debate that fails to serve investors.
Tim Armour adds that the majority of mutual funds offer poor or mediocre long-term returns because of excessive trading and high management fees. Opportunity costs and volatility risks of passive index investments are usually unknown or underestimated. Warren says that it is not about passive or active, but rather about delivering investment returns that are good in the long-term. He adds that the main components of such returns are low costs. Tim Armour says that this is the time to challenge the myth that passive index returns are the best and safe ways to a healthy retirement. Index funds offer no protection against down markets.
Timothy Armour works at the Capital Research and Management Company where he serves as the director, principal executive officer, and also the chairman. He has massive experience in the investment field. He previously held the position of an equity portfolio manager at the Capital Group Companies, Inc. He also worked as the equity investment analyst at the Capital Group where he was involved with US service companies and also global telecommunications.