Piles of empirical evidence tell us that in a typical year, 60% to 90% of...

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Finance

Piles of empirical evidence tell us that in a typical year, 60% to 90% of actively managed, actively traded stock funds do not do as well as indexed mutual funds sold by the likes of Vanguard and Fidelity. 1. What is an indexed fund and how does it work? 2. Why do indexed fund outperform most actively managed funds? 3. If we observe an actively managed fund consistently outperforming an indexed fund, what should we conclude?

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