The Capital Perspective On Investments

Warren Buffett is convinced that his strategy will yield better returns than those of hedge fund managers by simply investing in a S&P 500 passive index funds. His premise is that many investors are shortchanged by mediocre expensive funds.. Therefore optimum investment strategy is to buy and hold low cost, simple investments for the long term, a successful strategy.

In examining that strategy, consumers should be suspicious of product labels. Many mutual funds provide disappointing returns, due to high management fees and frequent trading. Simultaneously opportunity costs and volatility risks of passive index investments are misunderstood.

The notion that passive index returns is a secure way for retirement warrants examination. Index funds are a good choice for a particular objective, however they provide no insulation in a declining market, exposing investors to losses and volatility according to CNBC.

Read more: Capital Group Board Elects Timothy Armour as Chairman

While it is well known among investors that an ordinary actively managed fund has performed worse than the market over significant time horizons, there are exceptions to this. Exceptional fund managers are those not in high-cost funds who invest their own money in their fund, with resulting funds that outperform benchmark indexes.

Tim Armour’s thoughts on Post Trump market change are that there will be significant changes occurring rapidly. He thinks that the new administration’s policy will stop sluggish growth already occurring in the drilling and oil sector. Tim Armour of Capital Group also warns to expect increased turbulence in current languishing sectors such as utilities and real estate.

When Tim Armour Chairman of Capital Group was questioned about his perspective on the September 2015 market selloff, he stated that the US had a six-year bull run simultaneously with rising markets in most of the world. The U.S. markets were valued fairly, and valuations were extended for some sectors and companies. Therefore the market correction was largely anticipated and healthy since it eliminated pockets of excess.

For more information about Tim Armour, just click here.

Nabors’ CEO Tony Petrello Amends Its Corporate Governance And Executive Compensation

When Tony Petrello, CEO and President of Nabors Industries replaced former CEO Eugene Isenberg, in 2011, their share price increased by 180 percent.

Marketwatch reported on May 27th, 2014 that Mr. Petrello earned $68.2 million, in 2013, a 246 percent hike compared to 2012. He made number one on Equilar’s 2013 list of U.S. 50 top paid CEOs. It caused an uproar among many of the company’s shareholders who didn’t support its board’s executive compensation plan from 2011 to 2012. Tony Petrello became a member of the Board of Directors in 1991 and contributed to the company expanding to offshore, in 2002.

Nabors moved to Hamilton, Bermuda with the goal of reducing its federal tax liabilities in the United States. Some of the investors were disgruntled about the move and tried to intervene by filing a lawsuit against Nabors Industries, in Houston, Texas. A federal judge presiding over the case ruled in favor of Nabors granting expansion to Bermuda. To satisfy their shareholders, Tony Petrello and the company amended its corporate governance and compensation practices, in April 2014. One of the most significant changes to their practice of compensation is the executive severance payments limitation to three times an executive’s salary and bonus.

Tony Petrello is an experienced lawyer, executive leader, and philanthropist with years of expertise in corporate law, corporate planning, and operations. He holds a law degree from Harvard Law School and completed his undergraduate studies at Yale University. Since 1991, he has climbed the corporate hierarchy, presently serving as CEO, President, and Chairman of Nabors’ Board and Executive Committee. Mr. Petrello, along with his wife Cynthia Petrello are humanitarians and devote their time and money to Texas Children’s Hospital and the Dan and Jan Duncan Neurological Research Institute.

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