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Fees make this wrong, and then no one is talking about "stock market capital". They are talking about funds or people. As such, it's correct that few people bea

• reducesuffering 4y ago
  50% of funds and people absolutely beat the avg. index. Again, assuming efficient market hypothesis, it's by definition. As I've said, after fees, which is returned to the investor in the fund ~ -1%, of course it's not worth it. But the funds are throwing darts, the people are throwing darts, and 50% are beating the index. Only if you disbelieve the efficient market hypothesis, and think a few funds are disproportionately profiting ~100%/yr (you could maybe make the case for Rentech $10m medallion), would that be untrue.
  • danielmarkbruce 4y ago
    Brokerage fees. Even without that, still no. There is an implicit assumption in your math that bad and good investors aggregate funds in the same amount. They don't. And, depending on exactly how strictly you are defining EMH - I mean, does anyone believe it in it's strictest form? It's a crazy idea.