On Index Funds

Index funds are based on  the random walk theory. The proponents hold that it’s impossible to outperform the market without assuming additional risk.

Critics of the theory, however, contend that stocks do maintain price trends over time – in other words, that it is possible to outperform the market by carefully selecting entry and exit points for equity investments.

Four hundred seventy-three million to one. Those are the odds against George Soros compiling the investment record he did as manager of the Quantum Fund from 1968 through 1993. His investment record is the most unimpeachable refutation of the random walk hypothesis ever!