American investment icon and billionaire Warren Buffett has placed a $1 million dollar wager, arguing he can make better investment returns than a bunch of hedge fund managers by only investing in a S&P 500 passive index fund. The bet will be settled later this year and Warren Buffett is expected to be the one to collect. Buffett has said the money will go to charity. Warren Buffett believes that many expensive funds that end up costing investors. Both Tim Armour and Warren Buffett believe low cost and simple investments should be bought and held for a long period of time.
Buffett believes in “bottom-up investing” which analyzes companies and builds a strong portfolio, which has proven itself for Warren Buffett for many years. Buffett has also continued to call on Americans to start saving more for retirement and begin investing and to stay invested. Warren Buffett recently wrote a letter to his shareholders saying that the “active versus passive” debate does not help investors. Buffett has also said that mutual funds offer poor long-run returns because of excessive trading and costly management fees.
Buffett believes in delivering good long-term investment returns and that can be achieved by having low costs. Tim Armour does not support passive index returns being the key to a prosperous retirement. Buffett has discovered a way to separate the strong investors from the weak investors. You do that by analyzing low expenses and high manager ownership.
Tim Armour is chairman and chief executive officer of The Capital Group. He is also currently the chairman of the Capital Group Management Company. Tim Armour has amassed 34 years of investment experience with Capital Group. Tim Armour started out at Capital Group as part of The Associates Program. He was also an equity investment analyst at Capital Group, covering telecommunications and American service companies. He was named chairman in 2014.
Tim Armour currently resides in Los Angeles, California. He received a bachelors degree in economics from Middlebury College. He has made several appearances on CNBC and MSNBC. He’s also been featured in several financial magazines including bloomberg and the Financial Times to learn more: https://medium.com/@timarmour click here.