I was fortunate to have a couple professors back in my college days who instilled in me the lesson that it is nearly impossible to beat the market over the long term. Investors are best served when they simply own the market.
Since college I have been a passionate student of this idea. I have observed this in academic studies and in my own experiences.
Last week Eugene Fama was awarded a Nobel prize for the underlying theory supporting investing in the market vs. stock picking.
Below is a link to a short article and video interview with David Booth who has turned Fama’s research into one of the most successful mutual fund companies in the nation – Dimensional Fund Advisers (DFA).
I am proud to say that I am an approved DFA adviser and through that process was fortunate to be lectured by Eugene Fama at DFA’s headquarters.