Conventional wisdom states that index funds do very well in an up stock market but stumble during a bear market. The logic goes that an active manager will be able to see the signs of a downturn in the stock market and know when to get defensive. An index fund, on the other hand, will just stay in the stock market and rack up those losses. I think we can all agree that we are currently in a down market, so let’s examine how the index funds did versus their actively managed peers.
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