If I can't beat the market then why are there all these money magazines recommending single stocks?

Barnz, your blowing their mind.

Bottom line, its probability. Over the short term, you can beat probability, but over the long term you cannot. That is why people pick individual stocks, they think they can get in and out. Take the good, leave the bad, and beat the market. Easier said than done obviously.

Quote from PiratesSayARRR : You are alluding to the idea of persistence and frankly no one has done it.

Not even alluding anything, I said it would be nice if there's one that continue to profit and I'd put money there.
What's funny is I don't even put money in stock fund...One little comment will just get people to ramble on with their own opinion about something that's completely irrelevent.

Quote from barnz008 : You got me, I don't get it at all. .

yep, exaclty right. just rambling on your own thought.

Quote from barnz008 : You got me, I don't get it at all. So go ahead, buy only funds with a track record of beating the market. And when the market gets beat, so does the fund...yet the fund still beats the market. Because hey, -5% is better than -15%; which is like making 10%!!! You can also put your shoes on backward and run in reverse but all that matters is if you feel you've gone somewhere relative to the pavement. Other than that, one cannot beat the market. One can only take what the market gives them. Try to play it any other way and it will be happy to take your money all day long. That's not to say you cannot make money...I'm simply pointing out the obvious flaws in a dogmatic philosophy.

You can still beat the market by buying a Bear ETF, so even if the market gets hosed, you beat it, and made money on it. (Check the SlickDeals Marketwatch Competition. I 'beat the market' using 2 Bear ETFs)

Quote from 1stbuy : You can still beat the market by buying a Bear ETF, so even if the market gets hosed, you beat it, and made money on it. (Check the SlickDeals Marketwatch Competition. I 'beat the market' using 2 Bear ETFs)

I'm aware of strategies of all types - up, down, sideways, whatever.

Just because you make a successful trade only means you bet correctly on that hand. If you're so confident that you can repeat it again, roll it and see what happens. Basing your performance on a benchmark (index, composite, etc) is fine, but it means nothing at the end of the day to anyone else except you and some schmucks that sell you the idea that it does.

My stance is simple: you play the cards you're given. The moment you think you know what hand is coming next, the house takes your money. If everyone was able "to beat the market" all the time, it wouldn't move at all - shorts take the long's ask to sell and the longs take the short's exits. Complete flatline, no one makes a dime. That would be no market.

Think of it this way [let's try an appeal to authority]: if one of the all time great traders in modern history puts a bullet in his head due to the fact that he couldn't beat the market, I think the chances of you doing so are little to none. (Jesse Livermore) And if I guy like Martin Armstrong who they locked up for supposedly rigging the entire world market says carrying the idea that you can "beat the market" around in your head is completely idiotic, then you're equally likely to get taken to the woodshed and shredded. So, good luck with all of that....

Quote from barnz008 : I'm aware of strategies of all types - up, down, sideways, whatever. Just because you make a successful trade only means you bet correctly on that hand. If you're so confident that you can repeat it again, roll it and see what happens. Basing your performance on a benchmark (index, composite, etc) is fine, but it means nothing at the end of the day to anyone else except you and some schmucks that sell you the idea that it does. My stance is simple: you play the cards you're given. The moment you think you know what hand is coming next, the house takes your money. If everyone was able "to beat the market" all the time, it wouldn't move at all - shorts take the long's ask to sell and the longs take the short's exits. Complete flatline, no one makes a dime. That would be no market. Think of it this way [let's try an appeal to authority]: if one of the all time great traders in modern history puts a bullet in his head due to the fact that he couldn't beat the market, I think the chances of you doing so are little to none. (Jesse Livermore) And if I guy like Martin Armstrong who they locked up for supposedly rigging the entire world market says carrying the idea that you can "beat the market" around in your head is completely idiotic, then you're equally likely to get taken to the woodshed and shredded. So, good luck with all of that....

I agree not everyone will win, but you cant say if the market gets beat, so does the fund. I was confident...which is why I invested in multiple Bear ETFs. Not beating it with one single stock though.

This is all relative to how long someone decides to invest. We do play the cards we're given...but only we get to decide if and when to play the cards. Someones goal might be $1 million, they might pick one winner, which beats the market, and retire from investing for good. They still may have "beat the market" in that case.

Just checked the ranks

1st Place
1stBuy (+23.3%)
$123,380.99 $23,380.99 33

56th Place
barnz008 (-18.4%)
$81,594.45 -$18,405.55 38

Quote from 1stbuy : Just checked the ranks 1st Place 1stBuy (+23.3%) $123,380.99 $23,380.99 33 56th Place barnz008 (-18.4%) $81,594.45 -$18,405.55 38

I'm sure you'd be doing the exact same thing if it were real money. Speaking of which, I totally forgot about that game. Guess I got distracted trading the real market. Anyhooters, I'm off to go buy some index funds....

Quote from barnz008 : I'm sure you'd be doing the exact same thing if it were real money. Speaking of which, I totally forgot about that game. Guess I got distracted trading the real market. Anyhooters, I'm off to go buy some index funds....

Yikes, 40% less in just 2 months. This while making 5 more trades than me.

Could you just kindly pass along which funds you'll be dabbling in...I'll bet the opposite.

I don't "trade the real market". Leave it for the masses, its more like a glorified way of gambling. I like to be in control of my money, and there are better investment opportunities out there. (Another story, another thread...)

Total newbie question here, but what is the difference between opening an account with Schwab and buying their "Schwab S&P 500 Index" versus using a cheap broker like TradeKing to purchase the "SPDR S&P 500 ETF"?

Quote from gnuel : Total newbie question here, but what is the difference between opening an account with Schwab and buying their "Schwab S&P 500 Index" versus using a cheap broker like TradeKing to purchase the "SPDR S&P 500 ETF"?

• They might be the same stocks, but their company breakdown might slightly differ. So, it might not be an exact 1:1 match to S&P 500, but pretty close.
• The expense ratio [investopedia.com]
• The S&P 500 ETF (SPY) is most likely more liquid than the Schwab S&P 500 ETF, but it really only matters if you trade it a lot.

Quote from eatdirt40 : Barnz, your blowing their mind. Bottom line, its probability. Over the short term, you can beat probability, but over the long term you cannot. That is why people pick individual stocks, they think they can get in and out. Take the good, leave the bad, and beat the market. Easier said than done obviously.

This sums it all up! You're better off taking some money and playing the slots than trying to time individual stocks for a payday. What's even more depressing is that even if you time the market perfectly you need to have tens of thousands in it to make a decent profit in my opinion. It's fun analyzing earnings and current events to build a portfolio and try to make some cash, but not so fun losing money.

I personally like Armour REIT (ARR [ycharts.com]) for about a ~2 year investment.

• +17% Yearly Dividend Yield, Pays Monthly
• Low Interest Rate Dependent, Feds say they will keep rates low through 2013
• Low beta, so it doesn't really trade with all the market swings. The one blip in the chart was because some schmuck mistake another company for this one.

It won't last forever, but I'll take advantage of it while I still can. Looking for a 4-5% pullback in the $6.70 range to add to my position.

So I should sell all my individual holdings and move to ETFs and index funds?