Stock picking falls short again in 2021. 85% of active stock fund managers underperformed their benchmark last year. Let me say that again: EIGHTY-FIVE PERCENT of fund managers (super smart, very qualified professionals who do nothing but evaluate, analyze, and watch the stock market) UNDERPERFORMED their benchmark in 2021. By an average of 5%.
I’m pretty vocal about how I like to keep investments simple. The chart above is why. You could pay a fund manager to pick stocks for you, but there’s a really, REALLY good chance they’re going to fall short. And why would you pay someone more when you’re going to get less?
I know it’s tempting to go for those flashy, sexy strategies. But do yourself a favor and keep it simple.