If a rational investor believes that a passive strategy like indexing will usually outperform an active strategy like stock-picking, then why is it so difficult to stick to that passive strategy?
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Warren Buffet reminded us of this story when he delivered an epic rant against Wall Street last weekend during the annual meeting of Berkshire Hathaway. Buffett unloaded what he called a “sermon" about hedge funds and investment consultants. Shortly put, Buffet thinks these players are usually a "huge minus" for anyone who follows their advice.
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