Speaking at his company’s annual shareholder meeting, Berkshire Hathaway Chairman Warren Buffet said he far prefers index funds to exchange-traded funds because the latter encourages investors to trade frequently, Dow Jones reports.
“The best way, in my view, is to just buy a low-cost index fund and keep buying it regularly over time, because you’ll be buying into a wonderful industry, which, in effect, is all of American industry,” Buffet said.
“If you buy it over time, you won’t buy at the bottom, but you won’t buy it all at the top, either,” he added.
Buffet’s sentiments echo those of Vanguard founder Jack Bogle, who also is against frequent trading.
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