Can I study stocks and beat the market?
- Brianmcg321
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Re: Can I study stocks and beat the market?
You would actually do better just throwing darts at random stock tickers.
https://www.marketwatch.com/story/rando ... 2019-06-26
https://www.marketwatch.com/story/rando ... 2019-06-26
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Re: Can I study stocks and beat the market?
What is beating the market? Maybe the S and P ends the year up 8%, but you made 8.2%. You beat the market.
What your friends mean is that they just didn’t beat the market, but that they made a killing. Enough to FIRE.
???
I’ll bet your friends are pretty close mouthed about any details. Maybe you should ask.
Answer to your question is you could beat the market, maybe, with time and effort, and anxiety. But a killing enough to FIRE.
No.
What your friends mean is that they just didn’t beat the market, but that they made a killing. Enough to FIRE.
???
I’ll bet your friends are pretty close mouthed about any details. Maybe you should ask.
Answer to your question is you could beat the market, maybe, with time and effort, and anxiety. But a killing enough to FIRE.
No.
Re: Can I study stocks and beat the market?
It’s not about beating the market. It’s about how much risk you took to get the returns you got.
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Re: Can I study stocks and beat the market?
Everyone of my coworkers that goes to the casino wins money every time. That poor casino, they must be deep in debt. Hopefully the restaurants and hotel business keeps them afloat. What I can't figure out is why my coworkers bother coming back to work. They should just go to the casino instead. They must really, really just like to work.
- nisiprius
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Re: Can I study stocks and beat the market?
You have to be clear on your personal goals and what "beating the market" means to you and why you want to do it.
1) It is possible to use the stock market to gamble and to structure ones' investments to be like lottery tickets.
So think about lottery tickets.
The state lottery always makes money because it pays out less in jackpots than it takes in. Nevertheless, it is possible to buy a lottery ticket and win, and become pretty wealthy quickly. And you will of course here true stories about people who have done it. It isn't even rare. If you understand that statistically people who do it are going to lose money collectively, and it is worth it to you to have a small chance of being a big winner, then OK I guess. A problem here of course is that it is surprisingly difficult to quit while you're ahead. The behavior that can lead to turning $1,000 into $100,000 is likely to lead to trying to turn the $100,000 into a million, and people who win playing high-risk games often fail to hold onto those winnings.
But is the stock market a lottery? No, because in a vague long-term average kind of way, every year the stock market pays out maybe 10% more than the money that is put into it. That's because stocks are investments in companies that make money. But that's the kind of number we're talking about. Wait a year and get 10% more.
When you invest in stocks the way the WallStreetBets crowd does, where you are watching daily movements and trying to outguess and take money away from others, the "action" is taking place too quickly for the real earnings of real businesses to amount to much. Nobody was buying GME stock to collect the dividends.
If you are "trading" individual stocks and holding them for less than a year, then, yes, you are gambling, and no more likely to win than you are at a casino.
2) Using an index fund, anyone can match the return of the stock market to within closer than 0.1%. It doesn't require study. It doesn't require being an expert index-fund picker, a good dozen big firms offer index funds, not just Vanguard, and they all are able to do it. And the return of the stock market isn't bad, it's pretty good. Departing from an index fund just because "there might be something better" not doing enough "study." You have to ask "even if so, how much better" and "how sure is the improvement?" It's easy to shoot for "a little better" and end up doing "a little worse."
1) It is possible to use the stock market to gamble and to structure ones' investments to be like lottery tickets.
So think about lottery tickets.
The state lottery always makes money because it pays out less in jackpots than it takes in. Nevertheless, it is possible to buy a lottery ticket and win, and become pretty wealthy quickly. And you will of course here true stories about people who have done it. It isn't even rare. If you understand that statistically people who do it are going to lose money collectively, and it is worth it to you to have a small chance of being a big winner, then OK I guess. A problem here of course is that it is surprisingly difficult to quit while you're ahead. The behavior that can lead to turning $1,000 into $100,000 is likely to lead to trying to turn the $100,000 into a million, and people who win playing high-risk games often fail to hold onto those winnings.
But is the stock market a lottery? No, because in a vague long-term average kind of way, every year the stock market pays out maybe 10% more than the money that is put into it. That's because stocks are investments in companies that make money. But that's the kind of number we're talking about. Wait a year and get 10% more.
When you invest in stocks the way the WallStreetBets crowd does, where you are watching daily movements and trying to outguess and take money away from others, the "action" is taking place too quickly for the real earnings of real businesses to amount to much. Nobody was buying GME stock to collect the dividends.
If you are "trading" individual stocks and holding them for less than a year, then, yes, you are gambling, and no more likely to win than you are at a casino.
2) Using an index fund, anyone can match the return of the stock market to within closer than 0.1%. It doesn't require study. It doesn't require being an expert index-fund picker, a good dozen big firms offer index funds, not just Vanguard, and they all are able to do it. And the return of the stock market isn't bad, it's pretty good. Departing from an index fund just because "there might be something better" not doing enough "study." You have to ask "even if so, how much better" and "how sure is the improvement?" It's easy to shoot for "a little better" and end up doing "a little worse."
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
Re: Can I study stocks and beat the market?
All I can say is that it is much more likely I will describe a "great" return on a recently purchased stock using what most call play money and that represents about 1/15th of a percent of our portfolio than mention current bond returns unless the discussion does not focus on immediate returns. Maybe, we are outliers but just saying.
Tim
Tim
- bertilak
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Re: Can I study stocks and beat the market?
There IS something wrong with being lucky -- it's not sustainable. It is therefore not of much use for the long term. A single, successful, grab at the brass ring does not a successful investor make. Not even two in a row. Not even if you can brag about that grab (or two) for years to come.Marseille07 wrote: ↑Sun May 23, 2021 11:12 pm I never understood why people criticize "market timers" that they weren't skilled, they were lucky...as if there was something wrong being lucky
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Re: Can I study stocks and beat the market?
Yes you can! This is a very common occurrence and it happens all the time. Don't believe what you read on a forum based on the belief that indexing is the way to build wealth.
Re: Can I study stocks and beat the market?
newyorker wrote: ↑Sun May 23, 2021 9:57 pm I have never done it myself but I keep hearing my friends making 10x of their initial investment and etc.
Yes, friends will tell you that, but they don't seem to remember how much they lost. I have a friend that goes to a casino every week, and once in a while he will win. He always talks about the win, but most of the time no comment. If you have a friend who won big, OK, but that doesn't mean you can win doing the same thing.
Here are a few things to consider:
*Beating the market is difficult.
*There are three kinds of information - insider information, little known information, and widely known information. Which group are you in?
*The average investor does not get the average return.
https://www.fool.com/investing/general/ ... how-y.aspx
https://www.thebalance.com/why-average- ... ns-2388519
I am a regular boglehead with very little financial IQ and have been blindly investing in VOO with DCA. But I have an allure that maybe if I study finances and learn how to read financial reports and etc, I can beat the stock market and get rich or retire quick.
You might IF you get lucky, but the odds are knowing a little will just get you into trouble. Will learning something get you into the group of little known information? No, there are millions of investors who learn and study, but as a group there still has to be an average, and it's lower than the average market return.
If you follow Boglehead advice, you can get higher than average investor returns because average investors don't get average market returns.
Is this just a mirage? I mean many wall street guys do it all the time...
Well, if they do it all the time, then the average investor return should at least match the average market return, but it doesn't. Many investors learn something and immediately think they will net higher than average market returns--but they don't, and they always have an excuse.
Paul
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.
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Re: Can I study stocks and beat the market?
It's not either-or though. Even Mr. Bogle said we can play with 5% of "funny money" while 95% would be invested passively. If the OP can grow 5% into something much bigger, great. If not, not the end of the world losing 5%.bertilak wrote: ↑Mon May 24, 2021 12:15 pmThere IS something wrong with being lucky -- it's not sustainable. It is therefore not of much use for the long term. A single, successful, grab at the brass ring does not a successful investor make. Not even two in a row. Not even if you can brag about that grab (or two) for years to come.Marseille07 wrote: ↑Sun May 23, 2021 11:12 pm I never understood why people criticize "market timers" that they weren't skilled, they were lucky...as if there was something wrong being lucky
Re: Can I study stocks and beat the market?
You can and many people do. Most people lose money. The transfer of wealth has to come from somewhere. Why don't you start a thread and let us know how it goes? It can be like hedgefundie's excellent adventure thread. We'll all root for ya.
Re: Can I study stocks and beat the market?
As several posters have already mentioned, beating market in the short term is doable (luck and sometimes taking additional risk) but beating market long term is extremely difficult. Look at some of the well known funds, look at ARKK and other trendy picks of 2020, they all performed better than market at one time or another, sometime substantially, but over a much longer term (decades), they fade away as whatever advantages they had (being right on Tech or TSLA) eroded away as market is relatively efficient as a whole.
Re: Can I study stocks and beat the market?
You can't win if you bet on every horse, but you can win if you buy every stock.BrooklynInvest wrote: ↑Mon May 24, 2021 11:13 am My grandad would bet on the horses. When I was a kid I thought he was a genius because he won every time. Then I realized he only talked to me about his wins.
I think "great" stock pickers operate the same way with very rare exception.
VTI 48%, VXUS 12%, BND 40%
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Re: Can I study stocks and beat the market?
It's not guaranteed though. There's nothing to say we can't pull a Nikkei.gwe67 wrote: ↑Mon May 24, 2021 1:58 pmYou can't win if you bet on every horse, but you can win if you buy every stock.BrooklynInvest wrote: ↑Mon May 24, 2021 11:13 am My grandad would bet on the horses. When I was a kid I thought he was a genius because he won every time. Then I realized he only talked to me about his wins.
I think "great" stock pickers operate the same way with very rare exception.
Re: Can I study stocks and beat the market?
i always ask that question. "when we are talking about the market what is the market?" this is either directed to stock traders or active fund lackysShallowpockets wrote: ↑Mon May 24, 2021 11:22 am What is beating the market? Maybe the S and P ends the year up 8%, but you made 8.2%. You beat the market.
What your friends mean is that they just didn’t beat the market, but that they made a killing. Enough to FIRE.
???
I’ll bet your friends are pretty close mouthed about any details. Maybe you should ask.
Answer to your question is you could beat the market, maybe, with time and effort, and anxiety. But a killing enough to FIRE.
No.
Re: Can I study stocks and beat the market?
So to the OP; all kidding aside how many of your friends have really made 10X, got rich quick, and/or retired quickly? Seems to me there is wealth to be made buying stocks. I've managed to do well with the few that I picked in addition to what my basic, disciplined, and long term approach has been to investing and that is mutual funds and index funds. I've always understood what the company does, always taken a LONG term approach, always allocated a reasonable percentage to each stock, and always bought after they had taken a beating in the market for whatever reason. Luckily I'm yet to fail and overall my stock holdings represent about 10% of my net worth.
Bottom line; getting rich quick doesn't often work but can for some. Making 10X can't change your life unless you have a high percentage of your assets in a stock or stocks that perform at 10X. In hindsight I wish I had all my wealth in stocks like SBUX (Starbucks) and CMG (Chipotle) when I bought them but I don't but I still enjoyed the returns.
Read your own post, you admit you've never done it and admit to having very little financial IQ. Yes, study of course but proceed with caution and good luck!
- Sandtrap
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Re: Can I study stocks and beat the market?
You can optimize what you have and are building by mastering the “boglehead” basics and strategies in the forum Wiki as well as all the suggested reading.newyorker wrote: ↑Sun May 23, 2021 9:57 pm I have never done it myself but I keep hearing my friends making 10x of their initial investment and etc. Basically they got rich quick and were able to retire early or at least beat the market.
I am a regular boglehead with very little financial IQ and have been blindly investing in VOO with DCA. But I have an allure that maybe if I study finances and learn how to read financial reports and etc, I can beat the stock market and get rich or retire quick.
Is this just a mirage? I mean many wall street guys do it all the time...
Have you done this first?
j
Re: Can I study stocks and beat the market?
If you know what you're doing you can sometimes pick stocks and beat the market in the short term. But it's very hard to do over the long term and the amount of research, effort, and mental anguish to do so if you happen to slightly beat the market(which most people can't) is not worth it.
- illumination
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Re: Can I study stocks and beat the market?
Warren Buffett hasn't been able to in the last 16 or so years. Think of the research resources he has access to and the sort of sweetheart, insider deals he can make that a retail investor could never dream of. If Buffett just buys a stock, it (usually) soars just on his name alone. And yet he still comes up short with all of these advantages.
It's pretty sobering.
It's pretty sobering.
Re: Can I study stocks and beat the market?
pkcrafter wrote: ↑Mon May 24, 2021 12:34 pmnewyorker wrote: ↑Sun May 23, 2021 9:57 pm I have never done it myself but I keep hearing my friends making 10x of their initial investment and etc.
Yes, friends will tell you that, but they don't seem to remember how much they lost. I have a friend that goes to a casino every week, and once in a while he will win. He always talks about the win, but most of the time no comment. If you have a friend who won big, OK, but that doesn't mean you can win doing the same thing.
Here are a few things to consider:
*Beating the market is difficult.
*There are three kinds of information - insider information, little known information, and widely known information. Which group are you in?
*The average investor does not get the average return.
^The more a person tries to beat the market return, the more behavioral errors are likely to occur.
https://www.fool.com/investing/general/ ... how-y.aspx
https://www.thebalance.com/why-average- ... ns-2388519
I am a regular boglehead with very little financial IQ and have been blindly investing in VOO with DCA. But I have an allure that maybe if I study finances and learn how to read financial reports and etc, I can beat the stock market and get rich or retire quick.
You might IF you get lucky, but the odds are knowing a little will just get you into trouble. Will learning something get you into the group of little known information? No, there are millions of investors who learn and study, but as a group there still has to be an average, and it's lower than the average market return.
If you follow Boglehead advice, you can get higher than average investor returns because average investors don't get average market returns.
Is this just a mirage? I mean many wall street guys do it all the time...
Well, if they do it all the time, then the average investor return should at least match the average market return, but it doesn't. Many investors learn something and immediately think they will net higher than average market returns--but they don't, and they always have an excuse.
Paul
Last edited by pkcrafter on Mon May 24, 2021 3:12 pm, edited 1 time in total.
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.
- patrick013
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Re: Can I study stocks and beat the market?
Start a hypothetical portfolio for a start. Without a Finance degree
it's hard. Picking stocks with a bright future requires some evaluation
skills. Morningstar would say a wide moat or in common terms a better
moat(market) plus expected business performance would result in a good
portfolio.
Index replacement in an index fund should assure the better stocks are the
ones the index is invested in. The index creator's full time job is to buy and
sell at the right time to generate adequate returns while obvious secular
trends occur.
Nobody knows if Starbucks or Apple or Amazon will continue to beat the
market or if the market will crash so the index diversification is kinda nice
and keeps stock selection to a robotic methodology rather than emotional
guesswork or educated gamble like the Wall Street guys always do.
Looking thru ten sectors and picking ten sure winners is pretty hard to do all
the time with the limited resources individual investors have for needed market
information.
age in bonds, buy-and-hold, 10 year business cycle
Re: Can I study stocks and beat the market?
Back in the 90s several of my older friends made a lot of money in tech stocks. Some retired and one quit medicine to start an investment firm with like-minded doctors. A lot of those guys had to unretire and go back to practice after the tech wreck c 1999. Only one sold in time and went to bonds and as far as I know was the only one who stayed rich.
As was said earlier in the thread, people commonly mistake good luck in a bull market for financial talent.
As was said earlier in the thread, people commonly mistake good luck in a bull market for financial talent.
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Re: Can I study stocks and beat the market?
I don't understand this take. Sure they may have been lucky, but when did they claim they were a financial talent? Sounds like you're labeling them of something they never claimed they were.
And while at it, how is it different than a Boglehead starting investing in 1995 vs 2000? If one can be lucky picking stocks, one can also be lucky picking 3000 stocks as well. It's smoothed out for sure but bull markets & bear markets still come and go.
Last edited by Marseille07 on Mon May 24, 2021 3:49 pm, edited 3 times in total.
Re: Can I study stocks and beat the market?
If they're friends, then maybe they'd like to make a friendly competition out of it to see who's best. Each one sends you a quick text with their stock picks and price info and again when they sell. You keep a spreadsheet on it and tally up the results after, say, one year.
"The Quality of the Answer Depends on the Quality of Your Question."
Re: Can I study stocks and beat the market?
Market returns are, on average, what wall street guys do.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
Re: Can I study stocks and beat the market?
Of course you can. You are just as likely to not study stocks and beat the market, however. How you want to waste your free time is your business.
Good luck,
JT
Good luck,
JT
- ruralavalon
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Re: Can I study stocks and beat the market?
When does this become "piling on", for a 15 yard penalty?
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- BrooklynInvest
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Re: Can I study stocks and beat the market?
That's a good point and I guess that's what we do, but not what stock pickers dogwe67 wrote: ↑Mon May 24, 2021 1:58 pmYou can't win if you bet on every horse, but you can win if you buy every stock.BrooklynInvest wrote: ↑Mon May 24, 2021 11:13 am My grandad would bet on the horses. When I was a kid I thought he was a genius because he won every time. Then I realized he only talked to me about his wins.
I think "great" stock pickers operate the same way with very rare exception.
- patrick013
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Re: Can I study stocks and beat the market?
One company had a different strategy. Take a 200 stock value index.
Sort it for price/sales ratio. Take the top 50 or 100 stocks and sell
them to your clients. Sell the investment in 2 or 3 years and look at
the smiles on all your clients faces.
Sort it for price/sales ratio. Take the top 50 or 100 stocks and sell
them to your clients. Sell the investment in 2 or 3 years and look at
the smiles on all your clients faces.
age in bonds, buy-and-hold, 10 year business cycle
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Re: Can I study stocks and beat the market?
Yes. Maybe. But do you want to give up your day job?
If this is just something you dabble in you will fail. And there is a pretty steep learning curve.
You will be competing against people who have at their disposal a bevy of analysts and banks of computers. Now, are you willing to go up against them?
If this is just something you dabble in you will fail. And there is a pretty steep learning curve.
You will be competing against people who have at their disposal a bevy of analysts and banks of computers. Now, are you willing to go up against them?
Re: Can I study stocks and beat the market?
If you are investing in a taxable account, even if you beat the market before taxes, the tax drag will make it very difficult for you to beat the market.
Some people do though. What is your edge after “studying stocks”? Previous posters graciously discussed their edge. Do think that you can discern future performance from information that thousands of other people studying the same stocks miss?
You should read The Black Edge. Hedge funds like that are some of your competition.
You need a good risk management strategy to address those unknowns such as “Accounting Irregularities Identified In Company XYZ affecting the last 5 years of Profits”.
Then, as other posters have mentioned, you need the right investor behavior. Enough confidence that you are correct to weather the down-drafts, but not stubborn enough that you ride the stock down to pennies.
A speculator’s first goal should be to simply survive the bad times.
Or you could just buy VTI and beat the vast majority of professional money managers every year!
Please let us know what you decide to do and how well you do it.
Cheers
Some people do though. What is your edge after “studying stocks”? Previous posters graciously discussed their edge. Do think that you can discern future performance from information that thousands of other people studying the same stocks miss?
You should read The Black Edge. Hedge funds like that are some of your competition.
You need a good risk management strategy to address those unknowns such as “Accounting Irregularities Identified In Company XYZ affecting the last 5 years of Profits”.
Then, as other posters have mentioned, you need the right investor behavior. Enough confidence that you are correct to weather the down-drafts, but not stubborn enough that you ride the stock down to pennies.
A speculator’s first goal should be to simply survive the bad times.
Or you could just buy VTI and beat the vast majority of professional money managers every year!
Please let us know what you decide to do and how well you do it.
Cheers
“Doing well with money has little to do with how smart you are and a lot to do with how you behave.” - Morgan Housel
Re: Can I study stocks and beat the market?
It's very unlikely you can do better than average market returns. I don't see how your friends could be "retiring" unless they had significant capital to start with and got very lucky and really hit that 10X return you site. But, even at that can they really stop working? I highly doubt it. This sounds like a bit of hyperbole on their part.
Put it this way, you could go to Vegas and take your life savings and bet on red in roulette. I read about a guy a few years back that did that and it worked out for him. The same goes with picking stocks. Anything is possible and some people do win, but most do not.
Put it this way, you could go to Vegas and take your life savings and bet on red in roulette. I read about a guy a few years back that did that and it worked out for him. The same goes with picking stocks. Anything is possible and some people do win, but most do not.
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Re: Can I study stocks and beat the market?
Common? More common than not beating the market over the long-term? Please share your data/proof
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Re: Can I study stocks and beat the market?
If this was possible by studying why wouldn't everyone be doing it?
When you say Wall Street guys do it all the time, give us some examples
Re: Can I study stocks and beat the market?
Meir Statman used a tennis player analogy in his book "Finance for Normal People." This idea was discussed previously in Bogleheads and probably worth a re-read: Case against stock-picking: viewtopic.php?p=3691180#p3691180
I think you can study to be a tennis pro and beat the average tennis player easily. Same as for golf.
I think you can study to be a tennis pro and beat the average tennis player easily. Same as for golf.
Re: Can I study stocks and beat the market?
Sarcasm my friend, pure sarcasm.Johm221122 wrote: ↑Tue May 25, 2021 6:29 amCommon? More common than not beating the market over the long-term? Please share your data/proof
Re: Can I study stocks and beat the market?
Oh, one more thing: It is of benefit to the pros to have more amateurs doing stock picking because it lowers the average of the competition and makes it easier to come out ahead. Another way of thinking of this has to do with college admissions. The highly rejective universities really want a lot more applications, so that they can boast that they reject almost all applicants and select only a low single digit percentage for admission.
Re: Can I study stocks and beat the market?
I studied and invested in individual stocks for a bunch of years. When I compare my results to the market, I pretty much matched it, but did not beat it. On the positive side, I learned a lot, then moved to index funds.
Re: Can I study stocks and beat the market?
How is bnf (japanese trader) doing it? Guy made 10 figure NW just by day trading and i guess he has a secret where he sees a pattern in charts and etc.
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Re: Can I study stocks and beat the market?
Deleted
Last edited by Johm221122 on Tue May 25, 2021 8:22 am, edited 1 time in total.
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Re: Can I study stocks and beat the market?
Yes, that is one guy who "did it" past tense. But how many day traders lost money..
I remember years ago the big fad in day trading but I never later heard the stories of day trader millionaires (like bitcoin millionaires). Why did this fad die out?
Re: Can I study stocks and beat the market?
A couple I know tells me that every year they cash in excess of $100,000 in winning ticket vouchers from their slot machine play. I want to ask them how much they pump into those slots to get that much back, but I don’t want to jeopardize the friendship. My guess is probably about $200,000.
Re: Can I study stocks and beat the market?
The corollary is you can’t get lucky unless you play…anon_investor wrote: ↑Sun May 23, 2021 11:05 pm
I have a friend who is a crypto millionaire that retired before 40. He freely admits he was lucky with his timing (got into crypto early). Moral of the story? Better to be lucky than good.
- vanbogle59
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Re: Can I study stocks and beat the market?
+1.BrooklynInvest wrote: ↑Mon May 24, 2021 11:13 am My grandad would bet on the horses. When I was a kid I thought he was a genius because he won every time. Then I realized he only talked to me about his wins.
I think "great" stock pickers operate the same way with very rare exception.
Most are clever enough to hide their track records. Some go on TV and create a trail the prooves, empirically, that their crystal balls are cloudy.
Here is one example. Took me 2 min of googling to find it. You will find plenty more with a little effort.
This happened to a certain "BUY BUY BUY" expert with a massive research firm at his fingertips, and every other possible advantage:
"On March 11, 2008, XXX (who believe it or not is still on CNBC) told a viewer who wrote into his show, "Bear Stearns was fine!" right before the stock absolutely collapsed. The stock was trading at $62 per share. Just 5 days later, the firm was mercy folded into JPMorgan Chase (read: bailed out) at $2 per share."
Oops.
Re: Can I study stocks and beat the market?
Phil Michelsen just won the PGA Championship. How is he doing it? I also want to win $2.16M for just 4 days work.
/s
Last edited by David Jay on Tue May 25, 2021 8:38 am, edited 1 time in total.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
Re: Can I study stocks and beat the market?
If you live in Lake Wobegon, where everyone is above average, absolutely. Otherwise as many have said why would you think you can?
Re: Can I study stocks and beat the market?
Re: Can I study stocks and beat the market?
The analogy works either way though.newyorker wrote: ↑Tue May 25, 2021 8:41 amPhil Michelsen did it with skill but you guys are saying BNF did it with luck... but I think its a skill.
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Re: Can I study stocks and beat the market?
Then go ahead and try your luck. Assuming you aren't trolling to begin with.newyorker wrote: ↑Tue May 25, 2021 8:41 amPhil Michelsen did it with skill but you guys are saying BNF did it with luck... but I think its a skill.
Bulls make money, bears make money, pigs get slaughtered.
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Re: Can I study stocks and beat the market?
There are basically 2 ways to make money in the stock market.
1) Over time, the underlying assets become more valuable. "Rising tide floats all boats." Everyone wins.
2) I buy something from you for less than it's worth, or sell you something for more than it's worth. "Zero sum". For each win, there must be a loss.
BNF is a day trader, right (sorry, not familiar with his legend)?
That means he has does not participate in #1.
So, he must be doing it via #2.
If you engage in #2, you might end up like him. Or you might be giving your money to him (or someone like him). Zero sum.
BTW, Zero Sum is almost certainly worse than one loser for every winner. Winners tend to win a lot, creating many losers.
So, can you beat him?