Strategic asset-allocation decisions determine most of an investment portfolio’s subsequent return. Investors need to focus more on the composition of their portfolios and worry less about whether they are actively or passively managed.
ZURICH – Investors have long debated whether their portfolios should be actively managed or passively track a market index. But that discussion is becoming a sideshow. Encouragingly, attention is shifting to what matters most: the active decisions about strategic asset allocation that largely determine subsequent investment returns. To paraphrase Milton Friedman in the 1960s, we are all active now.
ZURICH – Investors have long debated whether their portfolios should be actively managed or passively track a market index. But that discussion is becoming a sideshow. Encouragingly, attention is shifting to what matters most: the active decisions about strategic asset allocation that largely determine subsequent investment returns. To paraphrase Milton Friedman in the 1960s, we are all active now.