but if i invest straight into the index, will i have the diversification level as what the index fund provides? and do i need to rebalance my portfolio itself?

yea i know index has beaten most of the hedge funds and mutual funds most of the time after comparing costs, thats why im into passive investing first

sorry if i quote again the same thing cuz i have another question regarding ur statement, anyway since investing in index fund means the diversification is there and i wont be doing the portfolio rebalancing , but if i invest straight into the index such as S&P, Dow, etc, i have to allocate how many portion of my money to which sectors myself, right? wont that be more troublesome as i can invest in index fund and the yearly expense might not exceed 1% itself?

er.. ETFs do charge yearly fees but it's minute comparatively to local mutual funds'
http://etfdb.com/2013/complete-history-of-spy/
http://usatoday30.usatoday.com/money/perfi...-etf-fees_N.htm
http://www.schwab.com/public/schwab/nn/art...hey-Really-Cost

er.. based on 1 or 0, there IS or NO management fees & other costs charged in ETFs?

Whether it is incorporated into the spread or not does not matter as others will argue the mutual funds' costs are incorporated into the NAV daily.

I'm pretty sure this idea came about cos someone read an online article about why index investing is better than buying mutual funds, or that Warrant Buffet recommends it. However ....

I hope TS is aware that MYR is near its all time weakest, whilst S&P, DJIA and RUT are near all time highs.

  Kasi lu manyak manyak like!

These people see some ang-moh or mat-salleh write some stuff and goes jerk-off. Become an instant fan-boyz!

Xuzen

Question: Why in Malaysia fund like Kenanga Growth Fund can beat the index or benchmark year in year out for the past ten years?

Answer: Semi strong market hypothesis

You should have seen his know-it-all responses to me.

I didn't bother replying.

It has been pointed out that US index funds beat most of the actively managed funds.
However, in the following article, the author warns:

http://www.kiplinger.com/article/investing...-opportuni.html

If what the author says is correct, then we can explain why US index funds outperform majority of the actively managed funds with the diagram attached.

Now, the question:
Why do many Malaysia mutual funds beat their benchmarks?

That is probably because not many investors buy Malaysian ETFs, thereby not able to push up the prices of the component stocks. (see post #13)

Of course, ignorant Westerners would think that internet access in emerging markets is very limited, and that information is disseminated much more slowly. As a result, Efficient Market Hypothesis doesn't hold true here as in developed markets