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Home | News | 2015 | Index Investing Puts Americans' Retirement Savings in Peril, Wintergreen Advisers Says

For the period ending March 31, 2018, the Fund's 1-year, 5-year, 10-year, and since inception (10/17/05) average annual returns for the Investor Class were 0.70%, 2.48%, 3.39%, and 5.48%, respectively, and the 1-year, 5-year, and since inception (12/30/11) average annual return for the Institutional Class were 0.97%, 2.72%, and 4.84%, respectively. Performance data quoted represents past performance and is no guarantee of future results. Current performance may be lower or higher than the performance data quoted. Investment return and principal value will fluctuate so that an investor's shares, when redeemed, may be worth more or less than original cost. Shares redeemed within 60 days of purchase are subject to a 2.00% redemption fee. As stated in the current prospectus, the Fund's total annual operating expense ratio for Investor Class shares (WGRNX) is 1.95%, and Institutional Class shares (WGRIX) is 1.70%. Click here to view the Fund's most recent month-end performance data.


Index Investing Puts Americans' Retirement Savings in Peril, Wintergreen Advisers Says

April 30, 2015

New York, NY - (Business Wire) - The rush of money into index equity funds has ballooned into a market mania that is fueling excessive CEO compensation and putting the savings of ordinary investors at risk, according to a new report by Wintergreen Advisers that was released today.

The report noted that the massive assets of index giants Vanguard, BlackRock (NYSE: BLK) and State Street (NYSE: STT) make them the largest block of shareholders in America's largest publicly traded companies, holding an average of 16% of the shares outstanding of the top 25 companies in the S&P 500.

David Winters, CEO of Wintergreen Advisers, said: "Trillions of ordinary investors' dollars are now committed to a mechanistic strategy that day in and day out simply buys stocks without a thought for their actual underlying value. Students of market history know that index mania - like other market fads before it - will end badly.

"The sad reality is that index funds have turned ordinary investors into the pawns in a game that undermines the integrity of American markets and imposes costs on society that don't show up in index fund expense ratios. We believe that one consequence of this is that billions of dollars of value created by American companies are being diverted to a select few executives while ordinary investors, distracted by 'low fee' hype, are subjected to dangerous risk concentrations in their retirement portfolios."

Wintergreen's analysis of the voting histories of the leading S&P 500 index funds run by Vanguard, BlackRock and State Street over the past five years for the 25 largest companies in the S&P 500 found that these funds cast their votes in favor of equity compensation plans 89% of the time, and opposed executives' pay packages less than 4% of the time. They withheld or cast votes against directors a meager 4% of the time.

Liz Cohernour, COO of Wintergreen Advisers, added: "Index mania has been a boon for executives of companies in the index, whether or not these executives are delivering real shareholder value. Flows into Big Index's fund products that tend to vote with management means a significant block of the shareholders in an S&P 500 company can generally be counted on to support executive compensation packages even when shareholders are receiving meager returns."

The Wintergreen report noted that index hype creates an illusion of safety and diversification. Wintergreen believes this can lead ordinary investors to take on a dangerously high concentration of risk in their investment portfolios.

By Wintergreen's estimate, the top 25 securities by market value in the S&P 500 in 2014 contributed over 33% of the index's total return, while the top 25 securities by performance contributed 55% of the index's total return. Apple, Microsoft, Facebook and Intel alone accounted for over 20% of the total return of the S&P 500 in 2014.

A copy of the Wintergreen report is available at http://www.wintergreenadvisers.com.


The views in the press and article reprints and hyperlinks shown were those of Fund management as of each article's publication date and may be subject to change. These materials should not be considered as an offer to sell or a solicitation of an offer to buy shares of any other funds or individual securities mentioned.

The article excerpts and hyperlinks reference individual securities that may or may not currently be held by the Fund. Click here to view a recent listing of the Fund's top 10 holdings. The S&P 500 Index is a broad-based, unmanaged measurement of changes in stock market conditions based on the average of 500 widely held common stocks. One cannot invest directly in an index.


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