I think beating the S&P is possible...so why do most fail?

Discussion in 'Investing' started by gtrudeau88, Aug 26, 2022.

  1. Spud

    Spud Well-Known Member

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    It's self explanitory. Some do well, others don't. Most that succeed don't post it on roadside billboards. Emotions are the main obstacles to overcome. Fear n greed are not your friend. The same in life, set your goals,study and achieve them.
     
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  2. Rayak

    Rayak Active Member

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    Two things are immediately obvious to me. I've stated them before, but I feel very strongly about them, so I'm hoping that some of those who disagree will tell me why they think I'm wrong, so that I can either change my opinion, or affirm it.

    1. Some people CAN and DO beat the S&P500 long term by trading! Some of them do it in non-conventional ways, or ways that would cause those who disbelieve the ability to 'beat the S&P500 long term' to cry 'foul!' because of semantics. EXAMPLE: someone starts with $50,000 and trades up to $300,000 within two years. Then then manage to build on those gains to the tune of $3 million. Then they retire and quit trading altogether. They are then able to average 3% annually on fixed-income investments, and live mostly on the proceeds of those fixed income investments. They have beaten the S&P500 for more than a lifetime - assuming 8% (or even a little higher) annual returns from the S&P.

    2. It is difficult to beat the S&P500, and may well be impossible for most people. Being a star athlete, or a famous actor/actress, or a Grammy-Award winning singer, or president of the country or one of only 100 senators in Washington, D.C. is impossible for MOST of us.

    What strikes me as odd is that nobody seems to claim that playing in the NFL or the NBA or MLB is "impossible" - that "it can't be done!". As far as I know, nobody ever told Brad Pitt or Sean Connery that "... it just ISN'T POSSIBLE to get rich and famous being an actor!"

    Although I'll bet they both heard things like "Good luck! 99% of those who try don't make it." Or "Fine, it's your life, but you'll probably end up at a desk like most of us, and years behind the career curve."

    As I've stated before, I'm not a trader. I have unconventional investment strategy, but it aligns most closely with being a long-term investor. I make no claim to beat the S&P500 long term, nor am I even trying to.

    I just don't understand why so many people aren't willing to acknowledge that "Yes, it's difficult - but some people do it and it can be done. By some people - not by everyone."
     
    #42 Rayak, Feb 1, 2023
    Last edited: Feb 1, 2023
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  3. TomB16

    TomB16 Well-Known Member

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    I don't share the same view as you two gentlemen so this is an indication I should pay attention as there is good potential for me to learn something.

    If you two make it rich, I would appreciate if you would circle back and, at least, let us know you are leaving after great trading success. Even better would be if you would share a broad idea of how you did it.
     
  4. T0rm3nted

    T0rm3nted Moderator
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    Well Tom, what I did was loaded up on GME calls a couple years ago after visiting WallStreetBets and seeing this dude named DeepFuckingValue tell us it was going to be the mother of all short squeezes. I went all-in with my families second mortgage at that time with calls and now I live in a 50k square foot beach house on my private island.
     
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  5. TomB16

    TomB16 Well-Known Member

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    So it took you two years to get rich? No wonder you're still here trying to figure out how to get rich quickly.
     
  6. TomB16

    TomB16 Well-Known Member

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    If you look at the Forbes list of top 10 wealthiest people, the only investor I see is Warren Buffett. The rest are business people who made their money in a single business. Perhaps "Carlos Slim Helu & family" is an exception, as they seem to have made their money from running a cartel.

    https://www.forbes.com/real-time-billionaires/#1dc9491c3d78
     
  7. T0rm3nted

    T0rm3nted Moderator
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    LOL obviously a joke. I'm just a regular middle class guy mostly invested for the long-term who does some swing trading here and there
     
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  8. TomB16

    TomB16 Well-Known Member

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    There are some pretty wealthy hedge fund managers who have net worths over a billion dollars. Bill Ackman immediately comes to mind.

    The thing about Bill Ackman is that he comes from money. He went to Harvard. He wasn't gifted all of his net worth but, like 100% of other hedge fund operators, he did not start from $0.
     
  9. TomB16

    TomB16 Well-Known Member

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    On the other hand, retirement villages around the world are literally full of Americans who started from $0, worked for 25+ years, put their money into VOO, and retired with a few million in net worth.

    Perhaps Internet trading is too new to impact the retirement age group. You would think think traders would start to dominate the luxury high rises and gated communities, by now. The small sample group if these luxury addresses I've been to suggest they are dominated by successful business people to me.
     
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  10. TomB16

    TomB16 Well-Known Member

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    I will say this, in support of trading... whatever you want to do in life, there will be a lineup of negative people wanting to explain to you why your idea is stupid and will not work. I try to not be that guy.

    In the case of trading, I don't think it's an idea. I think it's a compulsion. The gambling compulsion, to be specific.

    I'm a bit dubious on the idea that traders are modest people who wouldn't dream of bragging so they don't discuss their success publicly. That doesn't sound right. lol!

    I sincerely wish traders well. I know it's possible to make money with trading, on the short term. It's the long term I question but life is about learning so let's have a look at what successful trading looks like. Perhaps I will dump my strategy and embrace true success if I am shown a better way.
     
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  11. Rayak

    Rayak Active Member

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    I am not a trader. Nor am I a professional athlete, or a movie star. Not an astronaut, either. I'm not wealthy - not even close!

    I still can't understand why it seems like everyone can agree "No matter how hard it is, or how long the odds, some people do become astronauts, professional athletes and movie stars."

    But not as many can agree that "It's not bloody likely, and most who try fail, but some people can and do beat the S&P 500 over time."

    To me, it's the same basic concept. It's hard, and unlikely for most of us, but there's no doubt that some can and do - so why not admit it? I can't be an NFL player, or NBA, or MLB or a movie star or a U.S. senator or president - but I don't try to deny that SOME PEOPLE can?!?
     
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  12. Spud

    Spud Well-Known Member

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    It's got some catching up to do with my portfoolio. He'll Even Tesla is giving it a bloody nose.
     

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