After 40 years of operation and management, we have realized that what we can really grasp in the hands of investors is the cost of investment, which can determine the long-term return on investment. " On May 26, Lin Xiaodong, President of Vanguard Group in Asia, said at the 2019 Tsinghua Wudaokou global financial forum with the theme of "financial supply side reform and opening up".
Lin Xiaodong pointed out that the index fund in recent years has been particularly popular with investors, thinking that it is an angel coming down from the earth. But in the eyes of competitors and peers, index fund is a monster. Is index fund an angel or a devil? Why does the index bring value to investors in the long run?
Lin Xiaodong said that the index fund has the following advantages: first, it has a very clear predictability; second, its cost in the developed market is one fifth of that of active management fund; third, it has the advantages of wide range, dispersion and diversification; fourth, it has low turnover rate.