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Answer transcript: Don't look at holdings. Look at long term returns and how volatile they have been and this should be your primary guidance. If you look at the large-cap universe, you will come across 70-80 funds. 20-30 of these will not even able to match the return of the index. In the middle, there are index funds and then there are the long-term winners. These funds are able to beat the benchmark by 8-9% annually over a 5-10 year period. At any point, their portfolio looks alike.
This article was originally published on April 05, 2017.
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