Originally Posted by Lopez
As a Finance student myself, I've learnt to be sceptical towards "professional" portfolio managers.
Studies show that, while professional portfolio managers do make a better ROI than the index, the portfolio management fees push the ROI actually lower than the market. Additionally, there is no statistically significant correlation between the performance years of portfolio managers (i.e. that good years would be followed by good years, suggesting a "talented" investor) save for a few anomalies.
Most, if not all the time, people would be better of by investing to the S&P 500: with no administrative costs, it outperforms portfolio managers.
It helps if your manager is also a friend, who doesn't make unnecessary trades, and who outperforms the S&P by far.