You MUST Try Warren Buffet’s Inexpensive Investment Strategy

Image Source - Pexels.com

If you have been in the investing world for some time, you know that investing in low-cost index funds dominates the landscape.

[{"selector":"#anim-8e7e9954-e447-4e66-8dc5-70ab320f2055","keyframes":{"opacity":[0,1]},"delay":100,"duration":1700,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] Image Source- Google

Index funds, such as the S&P 500, are less expensive than mutual funds & have tax advantages, but how did they gain popularity?

[{"selector":"#anim-d81c692b-3579-462f-9c2d-14e8e4287c12","keyframes":{"opacity":[0,1]},"delay":100,"duration":1700,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] Image Source- Google

In 2007, Warren Buffett made a bet that index funds could beat active managers, and that was a crucial moment in its growth.

[{"selector":"#anim-8b252ea8-922d-4e13-afee-d01bb84682a5","keyframes":{"opacity":[0,1]},"delay":100,"duration":1700,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] Image Source- Google

According to Buffet’s bet, over 10 years starting in 2008, the S&P 500 would surpass the portfolio of five hedge funds.

[{"selector":"#anim-ce24a4c1-99df-4564-96f0-f4196717d41a","keyframes":{"opacity":[0,1]},"delay":100,"duration":1700,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] Image Source- Google

Warren Buffett was proved right as the hedge funds only gave a return of 36.3% while the S&P 500 had a return of 125.8%.

[{"selector":"#anim-8cd5811a-6e9b-4595-879a-abd3aa9cd391","keyframes":{"opacity":[0,1]},"delay":100,"duration":1700,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] Image Source- Google

Buffett recommended investors to continue with low-cost index funds after winning the bet.

[{"selector":"#anim-88bd13d4-47b9-4cbc-9d78-7f547f9980aa","keyframes":{"opacity":[0,1]},"delay":100,"duration":1700,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] Image Source- Google

When Wall Street takes hold of trillions of dollars, it is usually the managers that make money, not the regular investors.

[{"selector":"#anim-beb9bf9d-9bd9-4ee1-ad00-648c436dd8e1","keyframes":{"opacity":[0,1]},"delay":100,"duration":1700,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] Image Source- Google

Thanks to Warren, everyone can profit from low-cost index funds.

[{"selector":"#anim-29fc4d78-f78b-46e7-96b3-854ab92f4f37","keyframes":{"opacity":[0,1]},"delay":100,"duration":1700,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] Image Source- Google