Let’s do something boring just to drive home a point: Count up the number of years in Figure 23.1 in which more than half of the mutual funds managed to beat the S&P 500 index. (Recall that the Standard and Poor’s 500 is just a list of 500 large U.S. corporations—it’s a list that overlaps a lot with the Fortune 500.)
What percentage of the time did the experts actually beat the S&P 500?

Figure 23.1

Transcribed Image Text:

FIGURE 23.1 100 80 60 40 20 0 T 1 1 T I 87 81 35 33 8 24 77 89 33 85 84 47 71 56 15 31 20 53 37 38 60 78 1747676 59 Percent of Mutual Funds Outperformed by the S&P 500 82 64 45 46 40 78 85 75 90 83 1963 1965 1967 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997