The Wall Street Journal reports on last week’s television debate between John Bogle founder of Vanguard Group and Jeremy Siegel a professor at Wharton and affiliate of WisdomTree. The two debated about exchange traded funds versus mutual funds.
Siegel believes ETFs allow for a better strategy than index mutual funds, using fundamentally weighted ETFs, such as the ones offered by WisdomTree. Bogle does not think there is anything wrong with traditional indexes, so there is nothing to fix. He is also wary of relying too much on historical data.
The traditional market weighted index versus the fundamentally weighted index are just two approaches to investing. Although there is true performance for the traditional index, it will be a matter of time before there is true performance for the new ETFs.
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