In this edition of The Motley Fool's "Ask a Fool" series, Motley Fool One analyst Jason Moser and Motley Fool Stock Advisor analyst Brendan Mathews take a question from a reader who asks: "Are small cap, and emerging market index funds good idea, or are these two areas where the expertise of a managed fund is worth the cost?"
Brendan is skeptical of the idea that investors need an active manager for U.S. small-cap stocks, and Jason points out the diversity benefits of an index fund. As for emerging-market stocks, Brendan believes this is an area where active management may add value, as the big emerging index funds tend to be heavily populated with large state-owned enterprises that consider serving stockholders a secondary priority. Jason points out an alternative strategy for gaining exposure to emerging markets -- global blue chips with exposure to these markets.
So what's the best investing strategy?
It's no secret that investors tend to be impatient with the market, but the best investment strategy is to buy shares in solid businesses and keep them for the long term. In the special free report "3 Stocks That Will Help You Retire Rich," The Motley Fool shares investment ideas and strategies that could help you build wealth for years to come. Click here to grab your free copy today.