Also in this playlist...
This transcript is automatically generated
Index funds can be a great way to diversify your portfolio at a very low cost but.
What happens when your funds loading up on too much of the wrong investment.
Joining me now with tips to keeping your index funds diversified -- -- that CEO principal.
Of all that's personal wealth management thanks for coming on the show Lou it's great to have you here.
What concerns I have as do many index fund investors is that sometimes if you're buying one of these index funds -- one -- S&P 500 companies like say oh.
Apple has a big run.
It becomes a big part of your index fund because these things are market -- market cap weighted.
We do about that.
That's you have a difficulty with that now you can go shore.
The fund itself but I don't know the average investors and going to do that but you couldn't buy a EP and ETF.
Like the -- in the wisdom tree the ETFs.
Which tends to emphasize earnings and so if your company's going crazy in price.
It won't have as much.
Impact home so -- by earnings rather than weighted by market cap correct.
-- let makes sense to me know Jack Bogle who invented index funds for goodness sake has been complaining about bond index funds lately.
They're too heavily weighted for treasuries.
So what would you do in the case of a bond index fund which bond index fund would you buy.
I would buy the vanguard short term corporate I think that he's got a very real points.
Correct right now in which.
You know that.
Government bonds are being squeezed down.
And why do you want to participate in this squeeze down.
Bond fund that's not going to perform.
As well as.
Say corporates would.
Now I understand that you do like index funds generally -- you think they're good idea.
Is there now location -- that you like yes I would for people who like.
Index funds which means I don't want an investment manager and I don't want to really be actively.
-- -- I think a 60%.
Over mutual fund index 40% active management.
Works out very well.
Now are you think and the vanguard index funds or which ones would you choose the I -- I told you about what I was intrigued but I like vanguard diving the vanguard.
Is sort of close to -- Wal-Mart of the -- is.
And a very cost conscious and give you quality product.
Which is the point of having an index -- after all -- having low cost.
He say 6040 so sixty index forty actively managed why are you -- in the actively managed portion of the port will -- At the current time.
We really have.
It's that this situation is somewhat precarious.
You have about a 20%.
Chance that we can go back into a recessionary mode which would really trip up a lot of people.
And but -- myself believe that we're going to do better.
And exceed expectations.
-- growth and I believe that active managers know how to shift.
At at crucial times I think index funds don't do as well.
Interests and point.
Melissa thanks for coming on the show tonight we really appreciate your time well thank you enjoyed it's.
Filter by section