How ETFs Solve Information Overload

‍The Information Challenge

In today's investment world, more information doesn't always lead to better decisions. At Quantlake, we've studied this paradox extensively, and the research findings are compelling.

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🔍 The Evidence

The Choice Paradox Study (Iyengar & Kamenica, 2010)

When 401(k) plans add 10 additional fund options:

• Equity allocation ⬇️ 3.28%
• Investors shift to conservative options
• Long-term returns significantly impacted

The Trading Cost Study (Barber & Odean, 2000)

Annual Returns:

• Market: 17.9% 📊
• Most active traders: 11.4% 📉
• Average household: 16.4% 📉 → Cost of excessive trading: up to 6.5% annually

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🛑 Common Investment Traps

• Decision paralysis leading to cash hoarding
• Emotional reactions to market news
• Over-trading from information overload
• Defaulting to familiar but suboptimal choices

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⚡ Our Solution: Systematic ETF Portfolios

We've developed a research-based approach that:

• Simplifies Decisions Choose a strategy, not individual stocks
• Follows Evidence Built on academic research, not market noise
• Maintains Discipline Rule-based rebalancing removes emotion
• Focuses on Efficiency Broad-market ETFs capture returns systematically

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💡 Expert Validation

Investment thought leader Charles Ellis confirms: Long-term success comes from disciplined, systematic approaches - precisely what ETF portfolios deliver.

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🎯 Key Takeaway

As Warren Buffett demonstrated with his S&P 500 index fund victory over hedge funds, simpler investment approaches often yield superior results.

Our mission: Helping you achieve better outcomes through evidence-based, systematic ETF investing.

Ready to start your systematic investment journey? Create a free Quantlake account today.

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Happy Long-Term Investing from the Quantlake Team! 🚀

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