S&P Passive Funds Trumped Active Over Past Five Years

InvestmentNews (www.investmentnews.com) reported that a study from Standard & Poors Index Services indicated that passively managed funds outperformed the majority of actively managed for the past five years:

• Between 2004 and 2008, the S&P 500 stock index outperformed 71.09% of actively managed funds.
• The S&P MidCap 400 Index outperformed 75.9% of mid-cap funds.
• The S&P 600 Index outperformed 85.5% of small-cap funds.

Similar results were also reported for international and fixed income funds.

At Tarpley & Underwood Financial Advisors, we strongly believe that an investor is best served by using a passive approach. Please see the web site of our strategic partner (Dimensional Fund Advisors) for information on their approach to passive investing.

April Is Financial Literacy Month. Valuable resources on various personal financial topics can be found at the following websites:

360 Degrees of Financial Literacy

Feed the Pig

What To Do Now

Our investment management partners at Dimensional Fund Advisors have released a new web based presentation on how investors should view the markets now. In six parts, it's a lengthy presentation, but well worth your time. See the presentation at http://www.dfaus.com/share/whatshou/ .