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Index funds. You can't beat the market consistently. Maybe you can get lucky for awhile, but if you're relying on that, might as well go to Vegas and have more

by acheron 15y ago

Index funds. You can't beat the market consistently. Maybe you can get lucky for awhile, but if you're relying on that, might as well go to Vegas and have more fun at it.

forrestblount 15y ago
I've been using betterment for (non 401k) index fund exposure. They'll help guide your investment strategy, rebalance between funds automatically and allow you to shift between stocks and bonds (both indexes) as you please.
LinaLauneBaer 15y ago
I can't agree more. There are studies that show exactly what you describe. Also note: The stock market is extremely irrational and chaotic... people have a tendency to think they know better than the average. One study did do an experiment that went like this: They asked (I don't have the exact numbers at hand) 1000 people to answer the following question: Do you think that you are better informed about the companies that stocks you hold than the average stock holder who also invests in the same company. In a rational/non-chaotic market about 50% would say "yes" and 50% would say "no". If I remember correctly 90% said "yes" and only 10% said "no". When you buy stocks you should be aware of that because I think its very important to know...
tomgallard 15y ago
Tell that to Warren Buffet! Seriously though, of course the average investor cannot beat the market, it doesn't mean it isn't possible for an individual to do so, or that it is all down to chance. One approach is to focus on small companies. Most active funds will not invest here (it is not worth the time when they would only be able to invest a tiny fraction of their funds). As such these companies tend to be under-researched (not necessarily the same as under-valued though), so if you're willing to put in some leg-work and a lot of patience, there can be some good opportunities.
- DanBC 15y ago
  > or that it is all down to chance. No, it is all down to chance.
  - actionbrandon 15y ago
    or cheating--the oracle knows all about that.
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by acheron 15y ago

Index funds. You can't beat the market consistently. Maybe you can get lucky for awhile, but if you're relying on that, might as well go to Vegas and have more fun at it.

forrestblount 15y ago

I've been using betterment for (non 401k) index fund exposure. They'll help guide your investment strategy, rebalance between funds automatically and allow you to shift between stocks and bonds (both indexes) as you please.

LinaLauneBaer 15y ago

I can't agree more. There are studies that show exactly what you describe. Also note: The stock market is extremely irrational and chaotic... people have a tendency to think they know better than the average. One study did do an experiment that went like this: They asked (I don't have the exact numbers at hand) 1000 people to answer the following question: Do you think that you are better informed about the companies that stocks you hold than the average stock holder who also invests in the same company. In a rational/non-chaotic market about 50% would say "yes" and 50% would say "no". If I remember correctly 90% said "yes" and only 10% said "no". When you buy stocks you should be aware of that because I think its very important to know...

tomgallard 15y ago

Tell that to Warren Buffet! Seriously though, of course the average investor cannot beat the market, it doesn't mean it isn't possible for an individual to do so, or that it is all down to chance. One approach is to focus on small companies. Most active funds will not invest here (it is not worth the time when they would only be able to invest a tiny fraction of their funds). As such these companies tend to be under-researched (not necessarily the same as under-valued though), so if you're willing to put in some leg-work and a lot of patience, there can be some good opportunities.

DanBC 15y ago
> or that it is all down to chance. No, it is all down to chance.
- actionbrandon 15y ago
  or cheating--the oracle knows all about that.
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