In Lake Wobegon “All the women are strong, all the men are good looking, and all the children are above average”
Sadly, we know only 49% of the children can be above average or the median to be precise. It’s true of children and it’s true of investors. If you believe brains are what is needed to succeed with your investment plan, then you have to know that 49% of you will be disappointed.
Yes, you read it in magazines and newspapers, “our analysts are smarter than your analysts” but that doesn’t make it true. Consider your own situation, you have a job, you have a family, you have a life. You cannot devote all your time and brain power to your investments. Even if you could, you will probably be below average, if brains are the only source of investment returns. You aren’t smarter than most of the guys on Wall Street and you are certainly not smarter than the combined wisdom of all the participants in the equity markets
The good news is brains are not the determining factor for investment success.
You only need two things to insure long term investment success. Faith and Patience. Faith that the stock market may go down, but will not stay down and patience to leave your investments alone and let the magic of compound interest do its work.