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>Deviating from buy-and-hold indexing is mathematically a zero-sum game. If buy and hold indexing is not mathematically zero (which I agree it is not), then pl
by ChrisLomont 6y ago
>Deviating from buy-and-hold indexing is mathematically a zero-sum game.
If buy and hold indexing is not mathematically zero (which I agree it is not), then plenty of deviations from it are also not zero sum (which is empirically true).
Any stock gives partial ownership of a (hopefully) productive asset. Larger collections of them (like index funds) provide some reduction in volatility, but index funds are by no means the only way to structure risk/volatility tradeoffs.
- dcolkitt 6y agoI mostly agree with what you're saying. But the probability that that the average WSB retail investor reconstructs a Robinhood account with superior mean-variance optimization than an index fund, is about the same chance that my dog builds a fusion reactor after getting into my toolbox.