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Technology Stocks : America On-Line (AOL)

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To: sam who wrote (799)	1/1/1999 8:36:00 PM
From: 1SFG	Read Replies (1) of 41369

Since there is no need for any type of expertise in selecting the stocks I doubt there is a true manager of an index fund. My educated guess is that there is some type of 'caretaker' who makes sure that the delisted funds are sold and the new funds to the index are bought at the appropriate times. I am not disputing that funds lose money when they go down in value, common sense dictates that. I would like you to explain how an index fund manager can control the value of his fund if he is REQUIRED to buy ONLY specified stocks. That is all I have been saying. If I tell you to buy one share each of ten stocks at a specific date and time then hold them for EXACTLY one year and sell them, how are you going to improve that position? You can't. It is impossible. The MARKET dictates your buy and sell price and your profit or loss, not any actions on your part. THAT IS WHAT I SEE AN INDEX FUND DOING. THINKING THAT A MANAGER CAN MANIPULATE THE FUND TO MAKE IT MORE ATTRACTIVE IS, WELL, FOOLISH IN THAT SCENARIO. Finally, I would sell the index fund if it were going down in value but certainly see no reason to blame the manager since he had NO part in selecting the stocks.

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