The Long Term Investor Charley Ellis on Why Most Investors Fail (And What to Do Instead) (EP.191)
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Feb 12, 2025 Charley Ellis, a legendary investor and author of influential books, shares insights on why most investors struggle to outperform the market. He explains how investing has become a 'loser's game', where mistakes by others often dictate individual strategies. The conversation delves into the shift towards professional money management, highlighting the challenges faced by individual investors. Ellis advocates for index funds as a reliable long-term strategy, emphasizing a disciplined approach to investing and the importance of minimizing losses.
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The Loser's Game
- In tennis, amateurs lose points, while professionals win them.
- To win in amateur tennis, keep the ball in play and let your opponent err.
Investing's Transformation
- Investing used to be a winner's game when individuals dominated trading without access to research.
- Now, professionals with advanced resources and technology drive the market.
The Modern Market
- Today's market is highly competitive, with professionals, advanced technology, and readily available information.
- This efficient price discovery makes it harder for individuals to outperform the market.
