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Step 3: You can't beat the market |
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- The next theme is the advantage of passive or indexed investing in equities.
- Our site identifies studies which have convinced us (but, here as elsewhere, it is up to you to decide) that an individual investor without specialized expertise can rarely “beat the market” for shares, neither directly by the choice of specific securities nor by the selection of the “right”
 mutual fund. As a result, our site suggests that you beware of any person who claims that the purpose of a particular security will permit you to “beat the market”.
- On the other hand, if an investor is hesitant to solely invest passively in securities (he does not find it interesting enough) or is convinced on occasion that he has discovered a certain security which will double in price in a short period of time, or (for whatever other reason) our site proposes the concept of “pocket money” in order to permit alternative investing within quantitative limits which we recommend in order to avoid excessive risk taking.
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Last Updated ( Wednesday, 09 January 2008 )
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Quotation
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Many people do not consistently monitor their investments. They put their money away and fail to look every day, or even week, or even every year to see how their investments are doing. If the investments are invested for a child, it could be twenty years. If this describes you, then investing in the market averages solves the problem. The goal here is to pick an index fund and stick with it for life. There is no requirement that you actively monitor, or trade, your investments. Mac Barnes |
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