You may have heard that many experts believe retirement plan participants should only be allowed to invest in index funds. They say that the additional cost that participants pay for actively managed mutual funds is not justified by better performance. A number of employer plan sponsors have agreed, concluding that offering only index funds is the way to go. As a result, their fund line-ups are comprised almost entirely of index funds.
Recently, some academic studies have come to light which show that actively managed mutual funds are still a good value – provided you can find the funds that are truly actively managed.
