Myth: No one can beat the market!
This one is interesting because it is usually stated by people who can't beat the market, so for them , it is true.
First, let's define what meant by " beat the market". Usually, it means to outperform the broader market's gain or loss. For example, if the S&P500 gained 2% for the year, and a portfolio manager gained 3%, we can say that he or she " beat the market". It can also mean " Losing less" than the market has lost, which would also be "beating the market. If this is the definition, then the myth that no one beats the market is immediately debunked, because good portfolio managers frequently outperform the S&P500. In fact, it is often their stated goal.
However, i believe that when the pundits say that no one can beat the market, they mean that no one can successfully second-guess near term movements. Hence , if you trade , you won't do any better than if you just bought the market held on for a long period of time.
Nothing could be further from the truth! If nothing else , simply gauging the broader market direction would significantly increase your returns, even as a " Long-term" investor. Buying into the and merely holding through all its gyrations might produce a slight gain over a very long period (or most likely a flat return), but imaging if you could successfully gauge its direction and literally buy low and sell high, over and over? Your returns would be substantial-- even when the market is down or flat overall.
" People outperform the market all the time. Those who say it can't be done are telling the truth for them! All one has to do is successfully gauge market direction and ride the waves appropriately".
The method of swing stock traders is based on this theory and we know how to make nice profits.
Thanks for watching.
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