--- title: "Meaning & Key Takeaway of: Most investors, both institutional and…" description: "\"Most investors, both institutional and individual, will find that the best way to own common stocks (shares') is through an index fund that charges min..." image: "https://sms4smile.com/quotes/i/ea8/warren-buffett-183_beats_most-investors-both-institutional-and-in_192479.jpg" --- # Most investors, both institutional and individual, will… ![“Most investors, both institutional and individual, will find that the best way to own common stocks (shares') is through an index fund that charges minimal fees. Those following this path are sure to beat the net results (after fees and expenses) of the great majority of investment professionals.” quote by Warren Buffett](https://sms4smile.com/quotes/i/ea8/warren-buffett-183_beats_most-investors-both-institutional-and-in_192479.jpg) [Download](https://sms4smile.com/quotes/i/ea8/warren-buffett-183_beats_most-investors-both-institutional-and-in_192479.jpg) [Open image](https://sms4smile.com/quotes/i/ea8/warren-buffett-183_beats_most-investors-both-institutional-and-in_192479.jpg) > “Most investors, both institutional and individual, will find that the best way to own common stocks (shares') is through an index fund that charges minimal fees. Those following this path are sure to beat the net results (after fees and expenses) of the great majority of investment professionals.” [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) ## About This Quote This interpretation was drafted with AI assistance. It is one reading of the quote, not the author's own explanation. Low‑cost index funds typically outperform most active managers after fees, so investors should favor them. **In simple terms:** Cheap index funds beat most active funds. Key Takeaway Invest in low‑fee index funds. Themes investing fees passive strategy Mood practical confident Type financial advice investment When to use this quote - retirement savings - college funds - tax‑advantaged accounts - portfolio building Key Concepts market efficiency cost advantage Questions to Reflect On - Do you know your fund’s expense ratio? - Can you tolerate higher fees for potential outperformance? A Different Perspective Active managers can sometimes outperform in niche markets. ★ ★ ★ ★ ★ No ratings yet [Best way](https://sms4smile.com/quotes/about/best-way/) [Customer](https://sms4smile.com/quotes/about/customer/) [Index funds](https://sms4smile.com/quotes/about/index-funds/) [Individual](https://sms4smile.com/quotes/about/individual/) [Investing](https://sms4smile.com/quotes/about/investing/) [Investment](https://sms4smile.com/quotes/about/investment/) [Investors](https://sms4smile.com/quotes/about/investors/) [Path](https://sms4smile.com/quotes/about/path/) ## Related quotes > [... the best way to own common stocks is through an index fund.](https://sms4smile.com/quotes/warren-buffett/the-best-way-to-own-common-stocks-is-through-an-index-fund/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [The commission of the investment sins listed above is not limited to 'the little guy.' Huge institutional investors, viewed as a group, have long…](https://sms4smile.com/quotes/warren-buffett/the-commission-of-the-investment-sins-listed-above-is-not-limited-to/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [By periodically investing in an index fund, the know-nothing investors can actually outperform most investment professionals.](https://sms4smile.com/quotes/warren-buffett/by-periodically-investing-in-an-index-fund-the-know-nothing-investors/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [A low-cost index fund is the most sensible equity investment for the great majority of investors. My mentor, Ben Graham, took this position many…](https://sms4smile.com/quotes/warren-buffett/a-low-cost-index-fund-is-the-most-sensible-equity-investment-for-the/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [If you invested in a very low cost index fund - where you don't put the money in at one time, but average in…](https://sms4smile.com/quotes/warren-buffett/if-you-invested-in-a-very-low-cost-index-fund-where-you-don-t-put-the/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [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…](https://sms4smile.com/quotes/warren-buffett/the-best-way-in-my-view-is-to-just-buy-a-low-cost-index-fund-and-keep/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [Our standard prescription for the know-nothing investor with a long-term time horizon is a no-load index fund. I think that works better than relying…](https://sms4smile.com/quotes/charlie-munger/our-standard-prescription-for-the-know-nothing-investor-with-a-long/) [Charlie Munger](https://sms4smile.com/quotes/author/charlie-munger/) > [Most investors would be better off in an index fund.](https://sms4smile.com/quotes/peter-lynch/most-investors-would-be-better-off-in-an-index-fund/) [Peter Lynch](https://sms4smile.com/quotes/author/peter-lynch/) > [A minuscule 4 percent of funds produce market-beating after-tax results with a scant 0.6 percent (annual) margin of gain. The 96 percent of funds…](https://sms4smile.com/quotes/david-f-swensen/a-minuscule-4-percent-of-funds-produce-market-beating-after-tax/) [David F. Swensen](https://sms4smile.com/quotes/author/david-f-swensen/) > [Assuming that the future is like the past, you can outperform 80 percent of your fellow investors over the next several decades by investing…](https://sms4smile.com/quotes/mark-hulbert/assuming-that-the-future-is-like-the-past-you-can-outperform-80/) Mark Hulbert > [The simple index fund solution has been adopted as a cornerstone of investment strategy for many of the nation's pension plans operated by our…](https://sms4smile.com/quotes/david-f-swensen/the-simple-index-fund-solution-has-been-adopted-as-a-cornerstone-of/) [David F. Swensen](https://sms4smile.com/quotes/author/david-f-swensen/) > [Experience conclusively shows that index-fund buyers are likely to obtain results exceeding those of the typical fund manager, whose large advisory fees and substantial…](https://sms4smile.com/quotes/burton-malkiel/experience-conclusively-shows-that-index-fund-buyers-are-likely-to/) [Burton Malkiel](https://sms4smile.com/quotes/author/burton-malkiel/) > [Still, I figure we shouldn't' discourage fans of actively managed funds. With all their buying and selling, active investors ensure the market is reasonably…](https://sms4smile.com/quotes/paul-samuelson/still-i-figure-we-shouldn-t-discourage-fans-of-actively-managed-funds/) [Paul Samuelson](https://sms4smile.com/quotes/author/paul-samuelson/) > [After a lifetime of picking stocks, I have to admit that Bogle's arguments in favor of the index fund have me thinking of joining…](https://sms4smile.com/quotes/jim-cramer/after-a-lifetime-of-picking-stocks-i-have-to-admit-that-bogle-s/) [Jim Cramer](https://sms4smile.com/quotes/author/jim-cramer/) > [The key aspect of an index fund is that many of them, not all of them, but many of them are extremely cheap.](https://sms4smile.com/quotes/william-j-bernstein/the-key-aspect-of-an-index-fund-is-that-many-of-them-not-all-of-them/) [William J. Bernstein](https://sms4smile.com/quotes/author/william-j-bernstein/) ## More by Warren Buffett > [To invest successfully over a lifetime does not require a stratospheric IQ, unusual business insights, or inside information. What's needed is a sound intellectual…](https://sms4smile.com/quotes/warren-buffett/to-invest-successfully-over-a-lifetime-does-not-require-a/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [“Be fearful when others are greedy, and be greedy when others are fearful.”](https://sms4smile.com/quotes/warren-buffett/be-fearful-when-others-are-greedy-and-be-greedy-when-others-are/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [Making money isn't the backbone of our guiding purpose; it is the by-product of our guiding purpose.](https://sms4smile.com/quotes/warren-buffett/making-money-isn-t-the-backbone-of-our-guiding-purpose-it-is-the-by/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [We set no volume goals in our insurance business generally-and certainly not in reinsurance-as virtually any volume can be achieved if profitability standards are…](https://sms4smile.com/quotes/warren-buffett/we-set-no-volume-goals-in-our-insurance-business-generally-and/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [Everybody's got a different circle of competence. The important thing is not how big the circle is. The important thing is staying inside the…](https://sms4smile.com/quotes/warren-buffett/everybody-s-got-a-different-circle-of-competence-the-important-thing/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [It is better to point out your own mistakes than have somebody else do it.](https://sms4smile.com/quotes/warren-buffett/it-is-better-to-point-out-your-own-mistakes-than-have-somebody-else/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [I've read about all the sales today. If you're an auto dealer, you're feeling it. If you're a furniture retailer like we are, you're…](https://sms4smile.com/quotes/warren-buffett/i-ve-read-about-all-the-sales-today-if-you-re-an-auto-dealer-you-re/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [I was lucky enough to be born in a time and place where society values my talent, and gave me a good education to…](https://sms4smile.com/quotes/warren-buffett/i-was-lucky-enough-to-be-born-in-a-time-and-place-where-society/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [The most common cause of low prices is pessimism - some times pervasive, some times specific to a company or industry. We want to…](https://sms4smile.com/quotes/warren-buffett/the-most-common-cause-of-low-prices-is-pessimism-some-times-pervasive/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [The reaction of weak management to weak operations is often weak accounting.](https://sms4smile.com/quotes/warren-buffett/the-reaction-of-weak-management-to-weak-operations-is-often-weak/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [What you really want to do in investments is figure out what's important and knowable. If it's unimportant or unknowable you forget about it.](https://sms4smile.com/quotes/warren-buffett/what-you-really-want-to-do-in-investments-is-figure-out-what-s/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [I don't measure my life by the money I've made. Other people might, but certainly don't.](https://sms4smile.com/quotes/warren-buffett/i-don-t-measure-my-life-by-the-money-i-ve-made-other-people-might-but/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [I mean the truth is, I've never had it so good in terms of taxes. I am paying the lowest tax rate that I've…](https://sms4smile.com/quotes/warren-buffett/i-mean-the-truth-is-i-ve-never-had-it-so-good-in-terms-of-taxes-i-am/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [The most important quality for an investor is temperament, not intellect. You need a temperament that neither derives great pleasure from being with the…](https://sms4smile.com/quotes/warren-buffett/the-most-important-quality-for-an-investor-is-temperament-not/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [Investors, of course, can, by their own behavior make stock ownership highly risky. And many do. Active trading, attempts to "time" market movements, inadequate…](https://sms4smile.com/quotes/warren-buffett/investors-of-course-can-by-their-own-behavior-make-stock-ownership/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) [Explore all 984 Warren Buffett quotes ](https://sms4smile.com/quotes/author/warren-buffett/) ## More Beats quotes > [Histories never conclude; they just pause their prose. Their stories are, if they are truthful, untidy affairs, resistant to windings-up and sortings-out. They beat…](https://sms4smile.com/quotes/simon-schama/histories-never-conclude-they-just-pause-their-prose-their-stories/) [Simon Schama](https://sms4smile.com/quotes/author/simon-schama/) > [So many things beat upon us in a lifetime that simply enduring may seem almost beyond us… But the test a loving God has…](https://sms4smile.com/quotes/henry-b-eyring/so-many-things-beat-upon-us-in-a-lifetime-that-simply-enduring-may/) [Henry B. Eyring](https://sms4smile.com/quotes/author/henry-b-eyring/) > [The Beat Generation, that was a vision that we had, John Clellon Holmes and I, and Allen Ginsberg in an even wilder way, in…](https://sms4smile.com/quotes/jack-kerouac/the-beat-generation-that-was-a-vision-that-we-had-john-clellon-holmes/) [Jack Kerouac](https://sms4smile.com/quotes/author/jack-kerouac/) > [Certainly these are not easy times. But history does not contain very many easy times. Years from now, we will look back at this…](https://sms4smile.com/quotes/laura-ingraham/certainly-these-are-not-easy-times-but-history-does-not-contain-very/) [Laura Ingraham](https://sms4smile.com/quotes/author/laura-ingraham/) > [I usually write from the rhythm section...If a drummer got a funky beat on some things - like a half-shuffle or a shuffle or…](https://sms4smile.com/quotes/miles-davis/i-usually-write-from-the-rhythm-section-if-a-drummer-got-a-funky-beat/) [Miles Davis](https://sms4smile.com/quotes/author/miles-davis/) > [If you don't like club beats take a HIT OF E and you will love the music.](https://sms4smile.com/quotes/kevin-mccarty/if-you-don-t-like-club-beats-take-a-hit-of-e-and-you-will-love-the/) [Kevin McCarty](https://sms4smile.com/quotes/author/kevin-mccarty/) > [Every pitcher can beat you, it doesn't matter how good you are.](https://sms4smile.com/quotes/barry-bonds/every-pitcher-can-beat-you-it-doesn-t-matter-how-good-you-are/) [Barry Bonds](https://sms4smile.com/quotes/author/barry-bonds/) > [Only two to three per cent of an audience is interested in words and pays attention to lyrics; most of the rest of it…](https://sms4smile.com/quotes/al-stewart/only-two-to-three-per-cent-of-an-audience-is-interested-in-words-and/) [Al Stewart](https://sms4smile.com/quotes/author/al-stewart/) > [Joel Lane documents a life we don’t quite live, in a city we can’t quite find: half glimpsed and half imagined, we know it’s…](https://sms4smile.com/quotes/chaz-brenchley/joel-lane-documents-a-life-we-don-t-quite-live-in-a-city-we-can-t/) Chaz Brenchley > [Practice to beat the best.](https://sms4smile.com/quotes/dick-bennett/practice-to-beat-the-best/) [Dick Bennett](https://sms4smile.com/quotes/author/dick-bennett/) > [I don't know about the rest of the world, but I know in our region everyone is gunning to beat us. We have a…](https://sms4smile.com/quotes/landon-donovan/i-don-t-know-about-the-rest-of-the-world-but-i-know-in-our-region/) [Landon Donovan](https://sms4smile.com/quotes/author/landon-donovan/) > [Grand business plans are all very well, but nothing beats dipping your toe in the water.](https://sms4smile.com/quotes/baron-bilimoria-karan-bilimoria/grand-business-plans-are-all-very-well-but-nothing-beats-dipping-your/) Baron Bilimoria Karan Bilimoria > [Let a man who has to make his fortune in life remember this maxim: Attacking is the only secret. Dare and the world yields,…](https://sms4smile.com/quotes/william-makepeace-thackeray/let-a-man-who-has-to-make-his-fortune-in-life-remember-this-maxim/) [William Makepeace Thackeray](https://sms4smile.com/quotes/author/william-makepeace-thackeray/) > [Imagine if you were a drummer, and you accidentally picked up two magic wands instead of sticks. There you are, keeping the beat, the…](https://sms4smile.com/quotes/mitch-hedberg/imagine-if-you-were-a-drummer-and-you-accidentally-picked-up-two/) [Mitch Hedberg](https://sms4smile.com/quotes/author/mitch-hedberg/) > [I don't like small birds. They hop around so merrily outside my window, looking so innocent. but I know that secretly, they're watching my…](https://sms4smile.com/quotes/anonymous/i-don-t-like-small-birds-they-hop-around-so-merrily-outside-my-window/) [Anonymous](https://sms4smile.com/quotes/author/anonymous/) Browse all 3,311 Beats quotes ```json { "@context": "https://schema.org", "@graph": [ { "@type": "Quotation", "text": "Most investors, both institutional and individual, will find that the best way to own common stocks (shares') is through an index fund that charges minimal fees. 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