TIPs/HIPs vs Index Funds - II

 

Date: 28-Jan-98 - 7:46 AM
Subject: Index funds verse HIPS and TIPS
From: Tomc

With all that is written these days about the little probability of not being able to beat the indexes and the attractiveness of the low MERs on Index Funds I have been looking at these a little closer.

I have a few questions that I am sure folks will have answers to or opinions on :-).

1) What is the best Index Fund -For Canada -For US -For Europe 2) Why would it be better to by a Canadian Index fund verses TIPS?

I thought that I heard or read somewhere that TIPS gives you exposure to the index but does not give you the dividends that owning the stocks directl would? Is this true?

3) How much money would one have to have to purchase the equivant stocks for the TSE 300 and thus have your own index participation?

I look forward to your replys


Date: 28-Jan-98 - 8:20 AM
Subject: RE: Index funds verse HIPS and TIPS
From: Bubble

Here is a link to actual information about TIPS
You should also read what John Bogle has to say.


Date: 28-Jan-98 - 8:43 AM
Subject: RE: Index funds verse HIPS and TIPS
From: gummy

You might also want to read what our very own Madelyn has to say about HIPs and TIPs


Date: 28-Jan-98 - 8:50 AM
Subject: RE: Index funds verse HIPS and TIPS
From: Bylo

Do a filter on "index". If you go back 90 days you'll get a list of some 2 dozens threads on this topic.


Date: 28-Jan-98 - 8:53 AM
Subject: RE: Index funds verse HIPS and TIPS
From: y

HIPs and TIPs


Date: 28-Jan-98 - 8:54 AM
Subject: RE: Index funds verse HIPS and TIPS
From:

er, please no HTML in the first line


Date: 28-Jan-98 - 12:50 PM
Subject: RE: Index funds verse HIPS and TIPS
From: PK

To Tomc -

To answer just one of your questions, TIPS and HIPS do generate dividends. You might also be interested in knowing that membership in the Canadian Shareowners Association allows you to participate in a dividend reinvestment plan (DRIP) for these products.


Date: 28-Jan-98 - 12:56 PM
Subject: RE: Index funds verse HIPS and TIPS
From: jd

Toronto Star has an article entitled "The Case Favoring (sic, sigh) Index Funds." It refers to a study by three academic economists into mutual fund-buying behaviour.

The question is, why do managed funds grow and prosper in spite of the mountains of evidence that a simple low-cost index fund is the better option for investors?

The professors came up with the following conclusions:

1. Investors fail to evaluate their fund's performance against a relative benchmark like the TSE or S&P500. Instead they compare them with their savings account return.

2. Insecurity encourages investors to believe that paying for active fund management must offer some benefit.

3. Other investors believe they are smarter than the market and will eventually come out ahead. They seek control and ego-fulfilment. Well we know that conclusion certainly doesn't apply around here. :-) I am master of my own destiny and people who are poor have no one but themselves to blame. They should have bought Pfister.

4. Investors mistakenly believe that mf advertising connotes a fund company's financial strength and excellence.

5. The media create the illusion that factors impacting the market could have been known in advance by experts, whose positive results on any given day reflects superior knowledge.

6. The media deify active fund traders despite evidence that their chances of beating the market over time are worse than - dare I say it? - flipping a coin. The media perpetuates the idea that luck is skill. In other words, index funds aren't sexy enough to sell.

7. Investors are unaware of the costs associated with active fund management and the damage those costs impose on compounded returns over the years. Thanks to gumby's pictures that tell thousands of words, we all know better. Right??

8. Investors enjoy the thrill of taking risks and recounting their savvy skills (I'm guilty on that score - ask me how well my Aic Adv has done since I bought it back in late '95)


Date: 30-Jan-98 - 8:42 AM
Subject: RE: Index funds verse HIPS and TIPS
From: TOMC

Thanks for all the info. My filter was set at 30 days so I did not see the old discussions. Sorry to have asked a repetitive question


Date: 30-Jan-98 - 8:24 PM
Subject: RE: Index funds verse HIPS and TIPS
From: jog

jd: What was the date of that article on Index Funds? Globefund gives the U.S.Index Fund a 5 year rating of A+. Index funds always place in at least the 2nd quartile which is more than can be said about many fund managers.

TIPs vs. Index Funds


Date: 30-Jan-98 - 9:24 PM
Subject: RE: Index funds verse HIPS and TIPS
From: jd

jog,

It was the Jan28 (wed) Toronto Star, Business section, p. D4. I think this is the year I will get into TIPS-35.


Date: 31-Jan-98 - 8:44 AM
Subject: RE: Index funds verse HIPS and TIPS
From: Gumby

me too
... bid $35.95 yesterday
... didn't get any
... aah, but next week


Date: 05-Feb-98 - 10:19 PM
Subject: RE: Index funds verse HIPS and TIPS
From: TIPSinvestor

Does anyone know whether it is possible to reinvest the dividends distributed from TIPS just like reinvesting distributions from a mutual fund?

If so, do i just inform my broker?


Date: 05-Feb-98 - 10:22 PM
Subject: RE: Index funds verse HIPS and TIPS
From: PK

See my earlier posting on this thread. It's the only way I know of.


Date: 06-Feb-98 - 6:52 AM
Subject: RE: Index funds verse HIPS and TIPS
From: Bylo

Gumby,

Sigh, TIPS bid $36.95 yesterday. Bring back yer crystal ball.

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