After wagering $1 million for charity that he will receive better investment returns by simply investing in an S&P 500 passive index fund than a group of hedge fund managers, it appears Warren Buffett will collect on this bet.
Buffett’s general approach to investing is purchasing low cost, simple investments that should be held long term. His approach involves rigorously analyzing companies and building a lasting portfolio has been referred to as a bottoms-up investing approach and has proved successful over the years. There is much debate about active versus passive investing, but the key does not lie in the difference between the two. The key is delivering good long-term investment returns and the key to that is low costs. Identifying exceptional hedge fund managers are essential and the way to do this is finding those with low expenses and high manager ownership.
Tim Armour was named Chairman of the Capital Group in July, 2015. The mission of the Capital Group is to deliver superior, long-term investment results to their investors and clients. Tim has 32 years of investment experience, all with The Capital Group. He began his career at Capital in the Associates Program. His initial focus at Capital was analyzing global telecoms and US service companies.
The Capital Group has an 84-year legacy of following through on their commitments to their investors and advisors. Tim is known for playing an active part in the fightback of active fund managers against the rise of index tracker funds. He has been integral in providing research that shows the long term benefits of particular kinds of active fund management. He is a big proponent that people should not settle for “benchmark returns”, because there are better options available.
Tim holds a Bachelors degree in economics from Middlebury College.