[rockrock]

[ QUOTE ]
[ QUOTE ]
The average investor is competing with literally hunderds of billions of dollars seeking seeking to buy value stocks (and all other kinds of stocks as well).


[/ QUOTE ]

Individual investors are far more nimble than large funds can ever hope to be. Individual investors can take risks that funds can't.

Don't forget, the guys running these funds also don't have crystal balls, they are just individual investors with alot more money to work with and a larger support system, which gives them the disadvantage of higher costs to do what you can do rather cheaply, with only an investment of your time.

If you can identify the same opportunites as these funds do, before or slightly after they identify them, you will be very rich very quickly by riding their buying [img]/images/graemlins/wink.gif[/img]

[ QUOTE ]
How delusional and arrogant to think could do better.

[/ QUOTE ]

It is not arrogant, or delusional to think that an individual investor willing to put in the time, can and will outperform mutual fund managers... in fact, it is fairly close to a sure thing.

I personally know many long term investors that outperform the indexes, and I actively trade with many short term traders that are absolutely killing the markets!

My knowledge is based in reality, not some theoretical argument by someone who wrote a book [img]/images/graemlins/wink.gif[/img]

[/ QUOTE ]

You use index funds and mutual funds interchangeable above. I assume you meant plain index funds in both cases and not actively managed funds.

They beat what index? The S&P 500?

Big deal. Here is a list of off the top of my head of outperforming asset classes vs the S&P in the past few years: All small caps, large cap value, all midcaps, real estate, pacific (VPL, EPP), emerging markets, international small cap.

Anyone trading in those asset classes have probably beat the S&P but default. Not because they are geniuses but because the asset class outperformed. it has nothing to do with any bood they read or any analysis they did.

In other words how have they done relative to the indexes of the stocks they trade? I doubt you know "many people"

A perfect example of this is the motley fool and their newsletter Hidden Gems. They peddle this newsletter like its tomorrow's newspaper. The truth is most of the picks are small caps, and small caps have killed large caps for a while now.

The end result is that investors look like geniuses, when the real question is how did they perform versus the underlying asset class of the securities/