he previously mentioned research finds that an investor with $100,000 in an equity mutual fund has the equivalent of a $2,500 bet on the election already.
Saved by Lucas Kohorst
The economists wrote: “Our findings suggest that individual investors’ willingness to bear risk depends on personal history.” Not intelligence, or education, or sophistication. Just the dumb luck of when and where you were born.
There is reasonably strong evidence for what Thaler calls No Free Lunch—it is difficult (although not literally impossible) for any investor to beat the market over the long-term. Theoretically appealing opportunities may be challenging to exploit in practice because of transaction costs, risks, and other constraints on trading. Statistical pattern
... See moreAt the time of writing, pension funds and insurance companies in the United States and in Europe somehow bought the argument that “in the long term equities always pay off 9%” and back it up with statistics. The statistics are right, but they are past history. My argument is that I can find you a security somewhere among the 40,000 available that w
... See more“The number one thing to know is that investing is, at its core, an exercise in predicting the future.” Adeline was surprised by that. “I don’t get it.” “Think about it. When you buy a stock, bond, or other security, you’re making an educated guess about what’s going to happen, not just with the company or interest rates, but about what the future
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