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www.insideHALTON.com | OAKVILLE BEAVER | Thursday, October 30, 2014 | 36 DUTY Canada's pipeline companies have a duty to move energy with care. When a route crosses a river or stream, many steps are taken to protect precious water, natural habitat, and earn our continued right to operate. Learn more about CEPA Integrity First®. Delivering Canada's energy. Every day. Learn more about pipelines in your life at: aboutpipelines.com Managers don't add value to market continued from p.31 ing how to buy stocks, purchase them directly or choose a professional, such as a mutual fund manager, to make those decisions. Beat the market? Investors want to maximize their pro t and often want to "beat the market." Most rely on a professional manager, but with all of their expertise, do they actually add value and beat the market? Not according to the results. The reason professional managers do not add value to the investment process is because the stock market is extremely ef cient at determining the value of stocks. These managers also come at a fairly high cost. Ef cient market The business model of the investment manager is not one that adds value to an extremely-ef cient investment market. Their management costs are high and not economically justi ed. Covering costs In 2012, Eugene Fama said only three per cent of U.S. mutual funds with at least 10 years of results, managed to cover its costs. He has been arguing since the 1960s that markets are ef cient. In 2013, he received the Nobel Prize for his work in this area. We recommend you use this information to your advantage. The value of stocks is determined by expectations of future cash ow. The market is ef cient at determining the value of a stock and expensive managers do not add value. If you are investing, then seek out low-cost options that give you market investments. Do not spend money on managers who attempt to outsmart the market when history proves their high management costs are not economically justi ed. -- Submitted by Peter Watson, MBA, CFP , R.F .P ., CIM, FCSI., Certi ed Financial Planner