The focus on cost in the passive industry creates damaging misconceptions, writes Mark Northway. Here he explains why price might win the battle, but value will win the war
A battle on fees, a war on price or a campaign against charges - whichever way it is framed, the debate about passive funds and price is often far more superficial than it deserves to be. The age-old debate rages on - active managers claim that stock picking expertise, which they suggest leads to outperformance, warrants higher charges; the passive world says it can deliver commensurate returns at a fraction of the cost. But the passive industry may have become its own worst enemy in debating price on the investment battlefield, often using price as an overly simplistic differentiato...
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