by Jonathan Clements Aug 23, 2014 WSJ

1. You have no clue where stocks and interest rates are headed - and neither does anybody else. Instead of forecasting returns, investors should devote their efforts to cutting investment costs, trimming taxes and managing their portfolio's risk level.

2. Buying actively managed mutual funds is an act of faith in the face of daunting odds. S&P Dow Jones Indices, part of McGraw Hill Financial analyzed the performance of US stock funds in 13 categories. Depending on the category, just 14% to 39% of funds managed to beat their benchmark index over the five years through year-end 2013.

3. It's a huge mistake to compensate a financial advisor through commissions. Yes, it can be cheaper than paying a percentage assets. But paying commissions means the advisor's recommendations will always be suspect because he or she has an incentive o get you to trade more and buy higher commission products

then he goes on to insurance and home ownership stuff.

Even if someone does have a great idea in the stock market, how long does that last before that gets arbitraged away? The WSJ is generally dismissive of of high fees, 1.5% ? Think about that, it means in about 7 or 8 years your broker gets about 10% of your stocks. Not bad eh?

Cochrane's right, Fidelity has some of the lowest basis points in the business for index fund, that is, nobody's doing any picking at all, just buying the whole market. but compare that to the 150 basis points above for actively managed funds. If you have to go this way, eg, you don't want to deal with it think 50 to maybe 90 basis points. Even someone like T Rowe Price charges 60 basis points for a mutual fund like Growth and Income which should be a fairly staid business.
[Post edited by `lag at 07/17/2018 12:31PM]