There are no management costs with SPY and they are significant with some funds. If you have an electronic trading account you can be in or out of SPY in minutes and this can not only save you a fortune, but translate into a huge opportunity if you sell after a 200 point drop, watch the market fall another 400 to 600, or more, and wait a few days when it starts back up and buy in at a five to seven percent cheaper price while your friends in the managed funds wipe the omelets off their faces. As they are the product of 500 stocks they move with a lot of momentum. The green line is the 18 day moving average. They do not predict events or sudden turns, but are a useful indicator of long-term trends.
Many investors trade successfully on momentum indicators.
When you are an experienced trader it is possible to set up a portfolio that will have all the advantages of a mutual fund, none of the drawbacks and more opportunities. Any amount of cash will do, but the more you can trade the lower are the relative commissions. If you are careful to pick the highest quality companies in each sector, buy them at opportune times as we do in accord with the principles of stock surfing, you will beat the market indices handily. Yes, as long as you're on top of it. With most index funds you have to wait until the end of the day and some require written documents, which take another day by Fedex.