MFG .... or better MFF ... the latter is in the top 10 fund-mangers over 10 years in the world. He founded MFG and ran its portfolio for its first 6 years.
Even morningstar, who is meant to follow performance cant get their return right on MFF. The other 5 serious people and investment houses who follow returns however can and I think last one was 7% PLUS above the index over 10 years and similar for 5 and 3 year measures.
Its rare, to find a fund manger that adds value, year in, year out. The guy now running MFg is a good fund manager beating the index after costs by a small margin, so he is in the top 10% of fund mangers globally.
Beating it by 5% or more, the latter, MFF ... is, risk adverse, and has rarely taken any steps back at any stage even in the GFC compared to the index. Hard to do, in fact very hard to do.
Putting money onto an index fund, an overseas one based on USA stocks, is, well, given the index and USA stocks are at all time highs, all time highs compared even to the peaks of 1929 and 2000 ... and in fact 120% of those highs trading at 150% of GDP due to the fact no tax is being paid by any of them in the USA and rest of world. Investing into all times highs when looked at this way for the USA index, is asking for below par returns at some stage likely in a serious way.
So I caution the long term returns on both MFG and MFF until some sanity returns to the USA and its tax system and healthcare one.
Our index, well ... we are not even to pre GFC levels. Much the same for most other nations as they actually pay for healthcare ... USA has abandoned it ... and run a more balanced society than the USA. USA has decided, or the top 1,000 CEO;s and Billionaires there don't like tax, and here we have a stock market propelled by ... something that has a very finite life.
Our market, the tax burden has actually gone up 1% post 2000 .... USA has CUT the tax it collects, despite record profits and collects 6% less of GDP in tax.
Buying an index fund here, well, will not make you rich. MFF and MFG invest manly overseas for a reason and buying a stock here with a millstone around its neck, ignoring the human cost .... is why the USA is nearly 3 times the low ... of 2009. If we were the same the index would be 9,000 on the ASX 200 not 6,200 ish.
As for domestic decent fund managers ? who invest mainly in Australian shares ? Well ... last time I looked it was hit and miss and NONE .... not a single one got a tick beating the index by any decent margin without... WITHOUT leverage ... ona 1,3,5, and 10 year scale. Sure some pulled the proverbial rabbit out of the hat one year, only to swallow rubbish the next year.
Maybe its changed since I last looked but wrote a paper on it in 2016/17 so its unlikely anything new has occurred. Favorite trick or game woeful very big fund mangers played was when their fund did so badly it performed 2,3,4,5% Under the market and some cases close to 10% over a period, they wound the fund up .... covering their stinky record and opened a new suckers fund.
If one can outperform the market by 5% or even 10% over a long period, and the market itself over time rises 5% ... it doesn't take long to increase your wealth.
