I want to start this post with a couple sentences that I used in THIS recent note:
“An investor’s ability to successfully utilize the stock market as a vehicle for long term wealth accumulation is highly dependent on their own behavior. Bad decisions lead to bad results, aka – a behavior gap. Good decisions allow an investor to capture much of what the market will ultimately give them within their risk constraints.”
Notice I did not say good decisions allow and investor to beat the market year in and year out. Frankly, as a private investor with an investment horizon 5 years or longer, an objective of trying to beat the market is just silly because even if you do find it….you will most likely bail on the first bad quarter of performance much less the first bad year. Please google “Behavior Gap” for more detail.
The market is enough…your goal should be to take the good and stay away from the bad. Period.