Dimensional's 'Passive' (investment)Course Pays Off (as CEO retires)

[papau]

http://www.latimes.com/business/la-fi-rex30dec30,0,883984.story?track=tottext

From the Los Angeles Times
Dimensional's 'Passive' Course Pays Off
Rex Sinquefield retires 33 years after setting out key tenets of the investment strategy.
By Tom Petruno
Times Staff Writer

December 30, 2005

Rex Sinquefield gave up plans to become a Catholic priest in favor of a career in finance.

The church, he jokes, is better off. And so is the investment world, according to Sinquefield's many fans.

The 61-year-old Sinquefield will end an era today as he steps down as co-chairman of Santa Monica-based Dimensional Fund Advisors, an $86-billion-asset money management firm.

Dimensional, under Sinquefield and co-founder David Booth, was one of the pioneers of "passive" stock market investing — a discipline that sees no merit in trying to pick individual winners among equities, or in trying to time market swings.


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Booth likens investors' trust in active stock picking to buying lottery tickets: "While they have the lottery ticket they can dream the dream," he said. The efficient marketeers insist that the odds of beating the market over time indeed are analogous to the odds of winning big with Lotto: It's possible, but highly unlikely.