The Real Secret of Successful Investors

Historical market data are often misused by pundits who believe they can predict the future by looking at the past. Much of what counts these days as “financial news” is simply a parade of self-styled “pros” peering into their crystal balls and telling the rest of us how to time the market, pick outperforming stocks or select “hot” mutual fund managers.

It’s sad that so many investors base investment decisions on these musings, because it hasn’t worked out well for them. The only beneficiaries of this charade are “market beating” brokers, active fund managers and the financial media, which derives revenue from stoking fear and anxiety.

Investors’ poor performance

Richard Bernstein of Richard Bernstein Advisors looked at 20 years of historical data. You can find the results in a chart he prepared here.

Read the rest of the article at The Huffington Post.