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Why Most People Will Never Be Good At Investing

TedTed
in Fund Discussions
FYI: Most people in the stock market, most of the time, don’t do investing, which is…

.Thinking how markets work,
.Understanding how people behave,
.Studying businesses,
. Sticking only with what is simple and what they understand, and
.Buying stocks at appropriate valuations.

Instead, they are busy…

.Envying (others making money fast or losing money slow),
.Cloning (others’ stock ideas mindlessly),
.Predicting (future of markets, stock prices, and economy),
. Fearing (missing out on future gains),
.Regretting (past mistakes),
.Avoiding (accepting current mistakes),
.Denying (reality, especially when it’s harsh), and
. Indulging (in useless information and noise)
Regards,
Ted
https://www.safalniveshak.com/why-most-people-will-never-be-good-at-investing/

Comments

  • MJG
    Hi Guys,

    “Will never be good at investing” might be too strong a projection to fit my conservative perspective, but it is a reasonable forecast given the consistently bad historical record registered by both professional and private investors in the past.

    To be overly simple with the data, we only capture about 40% of what markets have historically generated. We buy and sell at the wrong times. Here is a short reference that includes a single summary chart that tells the sad story:

    https://seekingalpha.com/article/4108688-investor-returns-vs-market-returns-failure-endures

    Enjoy. I try hard to not be part of the general population represented in that great chart. Sometimes I succeed, but other times I fail. So be it. It’s hard to change.

    Best Regards


  • hank
    edited August 2019
    Pardon me if I’m wrong. But isn’t that the reason we buy mutual funds? To hire someone else to do our investing for us? I don’t know if I’d be any good at investing or not. Never bought or sold an individual stock or bond. I do know that some fund managers are better than others and some fund houses run a better shop than some others.

    I’ve been in and out of more fund houses in my near 50 years in the markets than I care to think about. Some that failed to satisfy me for one reason or another: Franklin/Templeton, Strong Funds, American Century, Calimos, TIAA-Creff, Hussman, Gateway, James Funds, Janus, Delaware, and most recently Oakmark.

    The company I trust most to do it right and to do it with integrity is T. Rowe Price. However, Dodge & Cox is also a favorite.
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