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Dude I used to work at a hedge fund, the whole efficient market hypothesis isn’t what you think, and it’s insane to think it means you need to buy every single
by greatpostman 5y ago
Dude I used to work at a hedge fund, the whole efficient market hypothesis isn’t what you think, and it’s insane to think it means you need to buy every single stock. You’re just going to lose a bunch of money investing this way
- gruez 5y ago>Dude I used to work at a hedge fund, the whole efficient market hypothesis isn’t what you think Oh? Please elaborate. >and it’s insane to think it means you need to buy every single stock. US "total market" only have about 2000-3000 stocks. >You’re just going to lose a bunch of money investing this way How? By buying losers? By wasting money on transaction fees?
- kqr 5y agoOnly 2000–3000 but they're so strongly correlated you could practically diversify just as much with less than 20–30, for 1/100 of the transaction costs.