You would be very, very surprised how few people are trying to pick stocks that they will hold for years and want to beat the market. Despite that being the gen

You would be very, very surprised how few people are trying to pick stocks that they will hold for years and want to beat the market. Despite that being the generally agreed point of "investing" over speculating. I'm including active investors as well as individuals in this, short termism is very prevalent, partly because people chase the fund that outperformed over the last X months. There is a small extent to which the drawbridge does get pulled up. Successful funds can close themselves to new business simply because they have too much money / clients for either their investment or client relations capacity. If a fund owns 4.9% several of its key investments then you can't admit new money without altering the balance of the fund and thus affecting the existing investors.